“Now we must focus on economic revival”, Dimantha Seneviratne, Director & Group CEO of NDB PLC

The spread of COVID-19 has jolted the world economy suspending business activities and forcing millions of people to stay at home, however, the Director/ Group Chief Executive Officer of National Development Bank PLC, Dimantha Seneviratne affirmed that its now the time to support the revival of the economy, and NDB is taking a lead role in it.

“Now we must focus and support the revival of the economy, and hence NDB has launched a unique proposition called ‘Jayagamu Sri Lanka’. This provides a complete solution to first time exporters, upcoming entrepreneurs and innovators as well as existing SMEs to reach new markets, help them through the process of exporting and even registering their patents. This was in collaboration with such bodies as Export Development Board, Sri Lanka Export Credit and Insurance Corporation, Daraz, Code360 and other service providers covering insurance, ERP solutions and business education. Moreover, NDB is partnering with fin tech companies to provide last mile financing as part of its supply chain financing solution. The need of the hour is to push money into the real economy to support demand driven production.”

Furthermore, Dimantha stated that there will be an uptick in economic activity in 2021, as opportunities exist for organisations and the government’s growth agenda will further support it.

“Whilst we believe the beginning of 2021 will continue to feel the effects of the second wave, there will be an uptick in economic activity as the year progresses. Opportunities exist for the agile organisation. We saw opportunities in 2020 and grasped them, similarly in 2021 also we see some unique opportunities in the government’s growth agenda which play to the strength of the NDB group. For instance, the NBFI consolidation and IPO’s; the NDB Group with its Investment Banking arm can lead this drive with the bank providing financing for such transactions. Also, with tax concessions given to many sectors, Investment Banking and the bank can help companies diversify into these sectors. NDB’s Personal Banking and securities can facilitate investments into equity securities, the cost of which are deductible for tax.”

Describing how NDB tackled the challenges posed by the pandemic, the CEO mentioned that the initial challenge was to keep the staff safe whilst ensuring uninterrupted service to customers’.

“In the first wave, the bank’s business continuity programme sprang to life wherein we enabled work-from-home, rosters and split locations. This ensured that we were able to continue serving customers even during the lockdowns with mobile ATMs and Banking on Wheels.

“The next challenge was to support the clients through these difficult times. NDB went over and above the mandated moratoriums after taking into consideration the particular circumstances of the client. In disbursing Saubhagya loans, NDB was the fourth largest, doing more than its share in this regard.”

Expressing his views on consolidation plans mooted for Non Bank Financial Services sector and how it would have an impact on Banking, Dimantha stated, “The NBFI sector has 41 Licensed Finance Companies and three specialised leasing companies with total assets at LKR 1.4Tr, which is about 8% of the Sri Lankan Financial sector assets. NBFI’s are closer to the grass root levels and provide enhanced financial services to a sector which is relatively financially illiterate. Through their interventions, they promote financial inclusion in Sri Lanka. With the government’s drive to grow the economy from the grass root level and promote broad based economic development and wealth distribution, the NBFI sector will play an increasingly important role. However, in order to do this, they need to have stability coupled with the ability to invest in technology and human capital. Consolidation of some of the players will help achieve this stability and enable them to face external shocks and vulnerabilities with resilience.

“A stronger NBFI sector is beneficial to the Banking sector because any adverse impact on the NBFI sector will have negative repercussions on the Banking sector and put pressure on the entire Financial sector. Furthermore, a stronger and stable NBFI sector will enable the Banking sector to support the grass root levels more efficiently through the NBFI sector. 

“However, care must be taken to ensure that in the process of consolidation, the institutes which work much closer to the ground, such as the community level development entities and cooperative based institutions, operating models are preserved.”

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