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400 million by securitising part of its small but growing hire purchase portfolio, the firm said Monday.
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People's Leasing Company has raised Rs. 400 million by securitising part of its small but growing hire purchase portfolio, the firm said Monday. Hire purchasing accounts for Rs 3 billion of the firm's business while its leasing portfolio now stands at Rs.
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14 billion.
The four-year issue, which was structured by Investec Capital (Pvt) Ltd.
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, was subscribed by DFCC Bank, National Savings Bank and Nations Trust Bank.
"There is a small advantage for us to engage in hire purchase business because of value added taxes. Vehicles registered for over a year in Sri Lanka are currently exempted from VAT, whereas for leases it is subjected to 15 percent," PLC's Deputy Manager (Finance) Udesh Gunawardene told LBO.
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PLC is currently one of the biggest players in the leasing industry that takes advantage of the debt market to raise funds.
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For the fiscal year ended March 31, 2005, PLC made a net profit of Rs. 310 million (up 38 percent) after making a Rs.
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437 million general provisioning.
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-LBO Newsdesk: LBOEmail@vanguardlk.com