July 16, 2011 (LBO) - Union Bank of Colombo (UBC) and foreign investment fund ShoreCap II will buy Sri Lanka's The Finance and Guarantee Company (TF&G), investing 1.1 billion rupees to revive the finance firm.
Union Bank chairman Aijta de Zoysa said in a statement the acquisition is part of Union Bank’s diversification and expansion plan to increase focus and growth in the small and medium enterprise sector.
ShoreCap II is a US-based international private equity company that invests in financial institutions serving micro and small enterprises in developing countries and transitional economies.
ShoreCap II has raised over 50 million US dollars in capital to support the growth of development finance institutions in Asia and Africa and between 2003 and 2008 invested in 15 small business banks and regulated microfinance institutions, the statement said.
Anil Amarasuriya, chief executive of UBC, said TF&G's deposit base is over three billion rupees with over half the deposits converted to non-voting shares with the consent of depositors.
Union Bank also acquired asset management company National Asset Management Limited in February 2011 and plans to launch mutual funds to retails investors through the bank’s branch network.
source - www.lbo.lk
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