New plan to pay Golden Key depositors

The Golden Key fiasco is to take new twist with the intervention of the Central Bank (CB) in creating a repayment mechanism through a Special Purpose Vehicle Company (SPV) for the benefit of nearly 10,000 depositors, official sources said.

The new plan is expected to come up before the Supreme Court hearing on the GK Fundamental Rights case on Tuesday, the sources revealed.

All the remaining assets of the GK company will be vested in the SPV and the CB will intervene in the operation of this company, once approved by the Supreme Court.

This new development follows the assurance given by the Government to GK depositors during the impeachment against former Chief Justice Shirani Bandaranayake.

GK depositors alleged that at least three previous attempts to introduce repayment plans had failed. The Watawala committee appointed by the Supreme Court was able to pay two instalments of Rs.100,000 each for depositors on the basis of either 75 per cent of the security deposit balances or Rs. 100,000, whichever is lower after verification by the auditors.

These payments were made by selling some GK assets.

Ms. Dushyanthi Hapugoda, Chairperson of the GK All Depositors Association told the Business Times that CB Governor Ajith Nivard Cabraal has assured the depositors that he will find a solution to the GK issue by introducing a viable bailout plan with the assistance of the government.

She expressed the belief that the governor will stick to his words, as he was very sympathetic about the plight of depositors, during recent meetings with representatives of depositors’ associations.