Companies linked to former Minister Daya Gamage owe the Sri Lanka Housing Development Finance Corporation (HDFC) about Rs. 974 million, a parliamentary subcommittee was told, NewsFirst reported on Monday.
The disclosure came at a subcommittee of the Committee on Public Enterprises (COPE), chaired by MP Asitha Niroshana and appointed to speed up COPE’s investigation process, which recently examined HDFC’s operations. The corporation is a state institution set up to provide concessionary housing loans to low and middle-income Sri Lankans.
HDFC Chairman S.P. Keerthirathne questioned how loans running to hundreds of millions of rupees had been approved through an institution that was not established to finance such entities. He said loans had over the years been granted to politically exposed persons, and that many remain unpaid.
Two companies, two loans
Officials identified Bimputh Finance Company as one borrower. It originally took a loan of Rs. 250 million, which non-payment and accumulated interest had pushed to about Rs. 430 million — though Deputy General Manager Kapila Deshapriya later put the current figure at Rs. 546 million.
Olympus Construction also borrowed Rs. 250 million, now Rs. 328 million with interest, Deshapriya said. On that basis the committee put the total recoverable at Rs. 974 million, and Niroshana said the amount linked to the Daya Group now stood at nearly one billion rupees. He added that several Sri Lankan financial institutions had reportedly recorded significant losses connected to the group, and that HDFC now appeared to be among them.
The two figures Deshapriya gave do not add up to the stated total: Rs. 546 million and Rs. 328 million sum to Rs. 874 million, Rs. 100 million short of Rs. 974 million. NewsFirst did not explain the gap, and it is not clear whether a third facility was counted.
Recovery and the Sevanagala payment
HDFC Assistant General Manager (Legal) Darshani de Silva told the committee a court order had been obtained to wind up and liquidate Bimputh Finance Company, that a liquidator had been appointed and that the process is underway.
The Daya Group had given HDFC a corporate guarantee, she said, and legal action on that guarantee is now before court. During those proceedings the parties told HDFC that a payment was due to them from the Ministry of Finance, and that they had no objection to banks recovering their dues from those funds. De Silva said the payment relates to the acquisition of Sevanagala Sugar Industries, that any payment would be subject to a court order, and that discussions are continuing at ministerial level.
The proceedings are a parliamentary examination of an outstanding debt, not a finding of wrongdoing by any court. NewsFirst did not report a response from Daya Gamage. The hearing came the same day a Samurdhi employees’ union asked the bribery commission to investigate his tenure as subject minister. As of Monday evening, no other verified Sri Lankan newsroom had published its own report of the subcommittee’s findings.
