In 2004, Sri Lanka bore the brunt of the Asian tsunami. The seven most affected districts – Ampara, Batticaloa, Trincomalee, Galle, Hambantota, Kalutara and Matara - suffered severe damages, particularly in the industrial and health sectors. BRAC quickly responded to the disaster by setting up relief and emergency operations in 2005and eventually expanded its programmewith the provision of microfinance loans for sustainable livelihood activities.
BRAC had expanded its outreach in the country, operated as BRAC Lanka (Guarantee) Ltd, played key role in Sri Lanka’s microfinance industry. Since its inception, BRAC had disbursed approximately 436,462 loans, helped to improve livelihoods through rigorous capacity development training. Over USD 93.2 million had been disbursed in microloans, with 68,880 active borrowers across the country’s 15 most vulnerable districts. BRAC continued providing services through 87 branches and 623 staff members.
BRAC partnered with Lanka Orix Leasing Company (LOLC) to acquire Nanda Investments and Finance Plc, and it was renamed as BRAC Lanka Finance Plc in December, 2013. BRAC Lanka Finance PLC planned to introduce more products and services including small and medium enterprise financing, leasing, hire purchases, and mortgage loan financing. With fixed and savings deposit product support the organisation was financially sustainable and BRAC was able to target different market segments. Our portfolio with BRAC Lanka Guarantee Ltd was merged into this new entity.
On January 2014, The Central Bank of Sri Lanka raised the capital and asset base requirements for the finance companies in Sri Lanka. The board decided to sale of our investment in Sri Lanka because of these hefty Central Bank regulations. Finally, BRAC sold its share holdings (59.33 per cent / 62,745,908 shares) of BRAC Lanka Finance PLC to Commercial Leasing and Finance PLC (CLC) a company within LOLC Group. CLC has acquired the share at LKR 608,635,307/ USD4, 681,810 (LKR 9.70 per share). The purchase price of the share was LKR 564,596,728/USD 4,343,052 and the price per share was LKR 8.998.