GK depositors say Kotelawala must pull them out of the brink
View(s):Disgruntled Golden Key (GK) depositors on Thursday urged President Mahinda Rajapaksa to intervene in persuading former Ceylinco Chief Lalith Kotelawala, the main culprit in the drama, to make a full commitment towards repaying their hard earned money, 64 months after the company crashed.
Around 600 depositors passed a resolution unanimously at a meeting at the Public Library auditorium in Colombo demanding the authorities to cancel the Central Bank (CB)’s action plan as it will not bring benefits for them.
Depositors at the meeting. Pix by Hasitha Kulasekera
They were of the view that this plan was a conspiracy aimed at tarnishing the image of the president who took a genuine interest and issued directives to the CB to find redress for disgruntled depositors.
Joint conveners of the Alliance of “Voice of Golden Key Depositors for Justice” Jude Marco Perera and Malcolm De Silva told the Business Times that they have decided to bring all GK depositors under one umbrella once again as the CB’s plan of action for the collapsed company will not be able to save a large majority of disgruntled depositors from the misery they are encountering at present.
The three directors representing depositors in the GK Special Purpose Vehicle (SPV) appointed with the consent of the Supreme Court have failed to fulfill their obligations betraying the rights of depositors, Mr. Perera alleged.
He said that the maximum amount that the depositors will get under the plan being implemented by GKSPV is only 13 per cent of their security deposits.
According to their memorandum submitted to the President, 1,330 small depositors whose security deposit balance was Rs. 487, 807 each at the time of the collapse of the company had been considered as fully settled under the action plan. In addition 758 more depositors with security deposits ranging from Rs. 487,807 to Rs. 771,707 were deemed to have been fully settled their money with the payment of the third tranche of Rs. 100,000 in accordance with the payment plan.
The security deposit holders (investors) who had already been paid 41 per cent or more of their outstanding balances will be considered as fully settled under this plan.
Around 3000 depositors who have individual balances amounting to around Rs. 1.22 billion will be left with the outstanding balance of Rs. 300,000.
Malcolm De Silva
According to the payment plan, all current individual net balances up to Rs. 300,000 will be retained within the security deposit holder’s account.
If the balance is in excess of Rs. 300,000, 33.3 per cent of it will be retained in the security deposit holder’s account and the balance 66.7 per cent will be converted into shares of GK. Under this set up depositors will not get a single cent, Mr Perera complained.
Defending the actions of GKSPV and CB’s action plan, GKSPV Director Dushyanthi Hapugoda revealed that they have also tried to bring Mr. Kotelawala into the scene but he has not extended his assistance to settle the matter during the past five years
She said that her board of directors and the task force are taking all possible steps to realise the assets of GK and its former directors in accordance with Supreme Court orders and the money raised will be spent to repay depositors.
Ms. Hapugoda said that the aim of the directors is pay as much as possible to depositors by selling assets.
Marco Perera
The repayments have now been fully completed under the first two phases where Rs. 200,000 was paid to each deposit holder.
In the third phase, the target is to pay Rs. 574 million to more than 6,000 depositors. Rs. 400 million has already been paid to depositors while the completion of the target of Rs. 574 million is expected around mid-May 2014.
In phase 3 the funds for repayment would come from selling certain identified assets of GK. Overall Rs. 1.9 billion has already been paid to depositors as at date under phases one, two and three, she said.
From June 2014 onwards GK expects to commence the next tranche of repayments where the resource requirements are higher at Rs. 2.5 billion, she said accusing Jude Marco Perera and Malcolm De Silva of trying to sabotage the process.
| CB’s action plan
-A depositor with security deposit of Rs. 1 million will get a maximum of Rs.36, 666.67 in |