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Page 2 PEOPLE’S LEASING & FINANCE PLC - DEBENTURE ISSUE 2015

PEOPLE’S LEASING & FINANCE PLC

Prospectus

People’s Leasing & Finance PLCDebenture Issue 2015

www.plc.lk

PEOPLE’S LEASING & FINANCE PLC - DEBENTURE ISSUE 2015 Page 3

“THE COLOMBO STOCK EXCHANGE (CSE) HAS TAKEN REASONABLE CARE TO ENSURE FULL AND FAIR DISCLOSURE OF INFORMATION IN THIS PROSPECTUS.HOWEVER, THE CSE ASSUMES NO RESPONSIBILITY FOR THE ACCURACY OF THE STATEMENTS MADE, OPINIONS EXPRESSED OR REPORTS INCLUDED IN THE PROSPECTUS. MOREOVER, AS PER THE CSE DEBT SECURITIES LISTING RULES SECTION 2.2.1(i) THE PAR VALUE OF A DEBENTURE SHALL BE HUNDRED RUPEES (Rs.100)”


PEOPLE’S LEASING & FINANCE PLC

Issue of Forty Million (40,000,000) Listed, Rated, Senior, Unsecured Redeemable Debentures of LKR 100/- each with an option to issue up to a further Twenty Million (20,000,000) Debentures in the event of an over subscription of the initial Forty Million (40,000,000) Debentures

TO BE LISTED ON THE COLOMBO STOCK EXCHANGE

ISSUE OPENS ON 5th NOVEMBER 2015

JOINT MANAGERS TO THE OFFERING

People’s Bank Investment Banking Unit NDB Investment Bank Limited,Head Office, No 40, Nawam Mawatha,13th Floor, Colombo 02.No 75, Sir Chittampalam A. Gardiner Mw, Colombo 02.


CORPORATE INFORMATION

The Company / Issuer People’s Leasing & Finance PLC

Legal Form A Private Limited Liability Company, incorporated in Sri Lanka under the Companies Act No 17 of 1982, converted to a Public Limited Company on 14th November 2000 and re-registered under the Companies Act No 7 of 2007 on 29th September 2008.On 17th of October 2012 the Company’s name was changed to People’s Leasing & Finance PLC. The Company was listed on the Main Board of the Colombo Stock Exchange on 24th November 2011.

Company No PB 647 PQ

Place of Incorporation 22nd August 1995, Colombo, Sri Lanka

Company Rating B+/AA- (lka)/ Stable by Fitch Rating Lanka Ltd

Registered Address No 1161, Maradana Road, Colombo 08. Tel: + 94 11 2631631 Fax: +94 11 2631980 / 81 Email: [email protected] Website: www.plc.lk

Company Secretaries Mr. Rohan Pathirage No.75, Sri Chittampalam A Gardiner Mw, Colombo 02. Tel: +94 11 2 481500 Fax: +94 11 2 434550 Auditors to the Company M/s Ernst & Young Chartered Accountants, No 201, De Saram Place, Colombo 10. Tel: +94 11 2 463500 Fax: +94 11 2 697369

Board of Directors Mr. Hemasiri Fernando Mr. Michael Pradeep Amirthanayagam Mr. Jehan Prasanna Amaratunga Mr. Namasivayam Vasantha Kumar Mr. Johnson Anthony Fernando Mr. Mohamed Anise Mohamed Rizwan Mr. Rathnayake Mudiyanselage Jayasena Dr. Ali Asgar Shabbir Gulamhusein


PARTIES TO THE ISSUE

Joint Managers to the Issue People’s Bank Investment Banking Unit People’s Bank Head office, 13th floor, No.75, Sir Chittampalam A Gardiner Mawatha Colombo 02 Tel: +94 11 2 206795-6 Fax: +94 11 2 458842

NDB Investment Bank Limited No 40, Nawam Mawatha, Colombo 02. Tel: +94 11 2300385-90 Fax: +94 11 2300393

Lawyers to the Issue Nithya Partners Attorneys at law No.97A, Galle Road Colombo 03 Tel +94 11 2335579 Fax +94 11 2328817

Registrars to the Issue SSP Corporate Services (Pvt) Ltd No 101, Inner Flower Road, Colombo 03 Tel +94 11 2573894 +94 11 2576871 Fax +94 11 2573609

Bankers to the Issue People’s Bank No.75, Sir Chittampalam A Gardiner Mw, Colombo 02

Trustee to the Issue Deutsche Bank AG No.86, Galle Road, Colombo 03 Tel +94 11 2447062 Fax +94 11 2576530

Rating Agency Fitch Ratings (Lanka) Ltd No.15-04, East Tower, World trade Centre, Colombo 01 Tel: +94 11 2 541900 Fax: +94 11 2 541903


LIST OF ABBREVIATIONS

AER Annual Effective Rate

ATS Automated Trading System of the Colombo Stock Exchange

CBSL Central Bank of Sri Lanka

CDS Central Depositary System (Private) Limited

CSE Colombo Stock Exchange

LKR Sri Lankan Rupees

NIC National Identity Card

POA Power of Attorney

PLC People’s Leasing & Finance PLC

SEC The Securities and Exchange Commission of Sri Lanka

SIA Securities Investment Account

SLIPS Sri Lanka Inter Bank Payment System

RTGS Real Time Gross Settlement

SDF Standard Deposit Facility Rate (Previously termed as CBSL Repo rate)


GLOSSARY OF TERMS RELATED TO THE ISSUE

Applicant(s) Any person(s) who submits an Application Form under this Prospectus

Application Form / Application The Application Form that constitutes part of this Prospectus through which an Applicant may apply for the Debentures

Business Day A day (other than a Saturday or Sunday or any Statutory Holiday) on which all licensed Commercial Banks are open for business in Sri Lanka.

Closing Date 26th November 2015 or such earlier date on which the initial Forty Million (40,000,000) Debentures are fully subscribed or unless otherwise decided by the Company to keep the Subscription List open until subscription of a further Twenty Million (20,000,000) Debentures or part thereof as may be decided by the Company.

Company / Issuer People’s Leasing & Finance PLC

Date of Allotment The date on which the Debentures will be allotted by the Company to the Applicants subscribing thereto

Date of Redemption The date on which the Redemption/Maturity of the Debentures will take place as referred to in section 1.7 of this Prospectus

Debentures All of the Listed, Rated, Senior, Unsecured Redeemable Debentures to be issued pursuant to this Prospectus

Debenture Holder(s) Any person who is for the time being the holder of the Debentures and includes his/her respective successors in title

Par Value LKR 100/- per Debenture

Interest Payment Date(s) Debenture Type A

the dates on which the interest payment shall fall due in respect of the debentures, being Semi- Annually at the expiration of every six (06) month period commencing from the date of allotment of the debentures and thereafter.

Debenture Type B

the dates on which the interest payment shall fall due in respect of the debentures, being annually at the expiration of every Twelve (12) month period commencing from the date of allotment of the debentures and thereafter.

Interest Period Debenture Type A

the six (06) month period from the date immediately succeeding a particular Interest Payment Date and ending on the next Interest Payment Date (inclusive of the aforementioned commencement date and end date) and shall include the period commencing from the Date of Allotment and ending on the first Interest Payment Date (inclusive of the aforementioned commencement date and end date) and the period from the date immediately succeeding the last Interest Payment Date before the Date of Redemption and ending on the date immediately preceding the Date of Redemption (inclusive of the aforementioned commencement date and end date).


Debenture Type B

the twelve (12) month period from the date immediately succeeding a particular Interest Payment Date and ending on the next Interest Payment Date (inclusive of the aforementioned commencement date and end date) and shall include the period commencing from the Date of Allotment and ending on the first Interest Payment Date (inclusive of the aforementioned commencement date and end date) and the period from the date immediately succeeding the last Interest Payment Date before the Date of Redemption and ending on the date immediately preceding the Date of Redemption (inclusive of the aforementioned commencement date and end date).

Issue The offer of Debentures pursuant to this Prospectus

Issue Price LKR 100/- per Debenture

Market Day Any day on which trading takes place at the CSE

Principal Sum The product of the number of Debentures allotted and Par Value

Prospectus This Prospectus dated 26th October 2015 issued by People’s Leasing & Finance PLC

Redemption Repayment of the Par Value and unpaid accrued interest (if any) with regard to a Debenture to a Debenture Holder, by the Company

Trust Deed Trust Deed executed between People’s Leasing & Finance PLC and Deutsche Bank AG, Colombo branch on 5th October 2015

Entitlement Date Market Day immediately preceding the respective Interest Payment Date or Date of Redemption on which a Debenture Holder would need to be recorded as being a Debenture Holder on the list of Debenture Holders provided by the CDS to the Company in order to qualify for the payment of any interest or any redemption proceeds.

Senior In relation to the Debentures means that the claims of the Debenture Holders shall in the event of winding up of the company rank in priority to the subordinated creditors of the Company but after the secured creditors of the Company and the preferential claims under section 365 of the Companies Act No 7 of 2007, and also in priority to and over the claims and rights of the shareholders of the Company.


ISSUE AT A GLANCE

Issuer People’s Leasing & Finance PLC

Instrument Listed Rated Senior Unsecured Redeemable Debentures

Listing The Debenture will be listed on the Colombo Stock Exchange

Number of Debentures An initial Issue of Forty Million (40,000,000) Listed Rated Seniorto be Issued Unsecured Redeemable Debentures with an option to issue up to

a further Twenty Million (20,000,000) of the said Debentures, at the discretion of the Company, in the event of an oversubscription of the initial Issue

Amount to be Raised Sri Lanka Rupees Four Billion (LKR 4,000,000,000/-) with an option to raise up to a further Sri Lanka Rupees Two Billion (LKR 2,000,000,000/-) at the discretion of the Company in the event of an oversubscription of the initial Issue

Company Rating B+/AA- (lka)/Stable by Fitch Ratings Lanka Limited

Issue Rating AA- (lka) by Fitch Ratings Lanka Limited

Issue Price LKR 100/-

Par Value LKR 100/-

Category of Debentures

Types of Debentures Interest Rate

Redemption/Maturity from the Date of

Allotment

Type A 9.60 %( AER 9.8304%)Payable Semi-Annually 48 Months (4 Years)

Type B 9.95 %( AER 9.95%)Payable Annually 60 Months (5 Years)

Minimum Subscription A minimum of One Hundred (100) Debentures (LKR 10,000/-) and in multiples of One Hundred (100) Debentures (LKR 10,000/-) thereafter

Interest Payment Date (s) Interest payments on the Debentures will be made by the Company within three (03) Business Days from the due dates, which are six (06) & Twelve (12) months from the date of allotment up to the date of redemption for respective debenture category.


In the event of the Final Interest, Final Interest payment will be paid together with the Principal Sum within Three (03) Business days from the date of Redemption/ Maturity

Mode of Payment Interest and Capital sum will be paid to Debenture holders through an electronic funds transfer mechanism recognized by the banking system of Sri Lanka such as SLIPS and RTGS in the event accurate bank details have been provided, or by crossed cheques marked “Account Payee Only” in the event accurate bank details have not been provided.

Issue Opening Date 5th November 2015

Issue Closing Date 26th November 2015 or such earlier date on which the initial Forty Million (40,000,000) Debentures are fully subscribed or unless otherwise decided by the Company to keep the Subscription List open until subscription of a further Twenty Million (20,000,000) Debentures or part thereof as may be decided by the Company.

Date of Allotment The Date on which the Debentures will be allotted by the Company to the Applicants subscribing thereto.

Basis of Allotment In the event of an oversubscription, the basis of allotment will be decided by the Board of Directors of the company within seven (7) Market Days from the date of closure.


Table of Contents1 INFORMATION RELATING TO THE ISSUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

1.1 INVITATION TO SUBSCRIBE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

1.2 SUBSCRIPTION LIST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

1.3 PROSPECTUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

1.4 OBJECTIVES OF THE ISSUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14

1.5 INTEREST ON THE DEBENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14

1.6 PAYMENT OF PRINCIPAL AND INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

1.7 REDEMPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

1.8 TRUSTEES TO THE OFFERING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

1.9 RIGHTS OF THE DEBENTURE HOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

1.10 RISK FACTORS ASSOCIATED WITH DEBENTURES . . . . . . . . . . . . . . . . . . . . . . . .18

1.11 BENEFITS OF INVESTING IN THE DEBENTURES . . . . . . . . . . . . . . . . . . . . . . . . . .18

1.12 TRANSFER OF DEBENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

1.13 LISTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

1.14 RATING OF THE INSTRUMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

1.15 COST OF THE ISSUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

1.16 BROKERAGE & FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

1.17 UNDERWRITING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

1.18 INSPECTION OF DOCUMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

2 PROCEDURE FOR APPLICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

2.1 ELIGIBLE APPLICANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

2.2 HOW TO APPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

2.3 MODE OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

2.4 REJECTION OF APPLICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

2.5 BASIS OF ALLOTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

2.6 ACCEPTANCE & REFUNDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

2.7 CDS LODGEMENTS AND TRADING OF DEBENTURES . . . . . . . . . . . . . . . . . . . . . .26

3 THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

3.1 INCORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27

3.2 CORPORATE PHILOSOPHY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27

3.3 CORPORATE BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27

3.4 GROUP STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28

3.5 FUTURE PLANS RISKS AND ASSUMPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29


3.6 SHARES IN ISSUE AND STATED CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32

3.7 MAJOR SHAREHOLDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32

3.8 SUBSIDIARIES/ASSOCIATE COMPANIES AS AT 30TH SEPTEMBER 2015. . . . . . .33

3.9 HUMAN RESOURCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33

3.10 DIVIDEND POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33

3.11 INTEREST COVER RATIO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33

3.12 DEBT SERVICING POLICY 30TH SEPTEMBER 2015 . . . . . . . . . . . . . . . . . . . . . . . .34

3.13 DEGREE OF DEPENDENCE ON KEY CUSTOMERS AND SUPPLIERS . . . . . . . . . .34

3.14 TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34

3.15 LITIGATION, DISPUTES AND CONTINGENT LIABILITIES . . . . . . . . . . . . . . . . . . . .34

3.16 MATERIAL CONTRACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34

3.17 TRANSACTIONS RELATED TO PROPERTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35

3.18 DETAILS OF COMMISSIONS & BENEFIT PAID . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35

3.19 CORPORATE GOVERNANCE PRACTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35

3.20 .PARTICULARS OF DEBT AND LOAN CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . .37

3.21 OTHER DEBT SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40

4 BOARD OF DIRECTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

4.1 PROFILES OF THE BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41

4.2 DIRECTOR’S STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

4.3 DIRECTORS INTEREST IN ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

4.4 DIRECTORS INTEREST IN CONTRACTS OR ARRANGEMENTS . . . . . . . . . . . . . . .45

4.5 EMOLUMENTS OF THE BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . .45

5 CORPORATE MANAGEMENT AND SENIOR MANAGEMENT & THEIR PROFILES . . . . . . . . . 46

5.1 CHIEF EXECUTIVE OFFICER/GENERAL MANAGER . . . . . . . . . . . . . . . . . . . . . . . . . . . .46

5.2 PROFILES OF THE SENIOR MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47

5.3 EMOLUMENTS OF THE SENIOR MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . .52

6 STATUTORY DECLARATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

6.1 STATUTORY DECLARATION BY THE DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . .53

6.2 STATUTORY DECLARATION BY THE JOINT MANAGERS TO THE ISSUE . . . . . . .54

6.3 STATUTORY DECLARATION BY THE JOINT MANAGERS TO THE ISSUE . . . . . . .54

7 FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

7.1 Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55

ANNEXURE I - RATING REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57

ANNEXURE II - COLLECTION POINTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61


1 INFORMATION RELATING TO THE ISSUE

1.1 INVITATION TO SUBSCRIBE The Board of Directors of People’s Leasing & Finance PLC by resolution passed

on 29th June 2015 and subsequent amendment passed on 28th September 2015 resolved to borrow a sum of LKR Four Billion (LKR 4,000,000,000/-) with the option of increasing the borrowing up to a further LKR Two Billion (LKR 2,000,000,000/-) in the event of an oversubscription, from the public by the issue of Listed Rated Senior Unsecured Redeemable 4 & 5 year Debentures at an issue price of LKR 100/- per Debenture.

Under this issue, up to Sixty Million (60,000,000) Listed Rated Senior Unsecured Redeemable 4 & 5 year Debentures will be issued at the issue price of LKR 100/- each with a fixed interest rate.

People’s Leasing & Finance PLC invites Applications for Debentures which will be ranked equal and Pari Passu with each other without any preference or priority of any one or more than over the others except for the tenor of the Debentures and the Debenture Interest Rates with the Debenture Interest payment frequency as more fully described in Section 1.5

It is the intention of the Company to list the Debentures on the Colombo Stock Exchange. The CSE has given its approval in principle for the Listing of the Debentures on the CSE.

1.2 SUBSCRIPTION LIST Subject to provisions contained below, the subscription list for the Debentures will

be opened at 9.30 a.m on 5th November 2015 and shall remain open for 14 Market Days until closure at 4.30 p.m on 26th November 2015.

However in the event of an oversubscription of the Sixty Million (60,000,000) Debentures, the subscription list will close at 4.30 p.m on the same day on which it is fully subscribed, with the notification of CSE,

Further, the Board of Directors may, at their discretion, decide to close the subscription list prior to the issue being fully subscribed, in such event the subscription list will close at 4.30p.m on the market day succeeding the date of notification to the CSE.

Application may be made forthwith. Duly completed applications in the manner set out under the procedure for application in section 2 of this prospectus will be accepted.

1.3 PROSPECTUS The date of this Prospectus is 26th October 2015.

This Prospectus has been prepared jointly by People’s Bank Investment Banking Unit & NDB Investment Bank Ltd (Joint Managers) on behalf of People’s Leasing & Finance PLC from the information provided by the Company and which is publicly available. The Company and its Directors having made all reasonable inquiries, confirm that to the best of their knowledge and belief the information contained in the Prospectus is true and correct in all material respects and that there are no other material facts, the omission of which would make any statement herein misleading. While Joint Managers have taken reasonable care to ensure full and fair disclosure of information, Joint Managers don’t assume responsibilities for any investment decisions, prospective investors must rely on their own examination and assessments of the Company, including the risk involved.


Any other person other than People’s Leasing & Finance PLC or Joint Managers to the issue or authorized agent assigned by Company or Joint Managers to the issue, giving information to take any representation in connection with the Debenture Issue other than the information and representations contained in this Prospectus and if given or made, such information or representations must not be relied upon as having been authorized by the Joint Managers to the Issue or People’s Leasing & Finance PLC.

1.4 OBJECTIVES OF THE ISSUE

- The proceeds of the Issue would be utilized within 6 months from the date of allotment for working capital purposes of the Company; i.e. disbursement of Leasing, & other Loan facilities

- Access to additional source of funds from non-deposit source, which will open up capital market funding (public listed) for PLC and tap a wider investor base with an appetite for innovative financing and risk profile.

- To minimize the interest rate risk and the gap exposure in PLC’s Asset / liabilities portfolio and facilities future expansion of operations and the asset base. The funds raised through the issue to be allocated proportionately to expand the asset base as below.

Lease 64%

Loan 36%

- To mobilize / raise medium term funds to match the medium to long term lending of PLC and to Minimize the mismatch in funding exposure.

1.5 INTEREST ON THE DEBENTURES

The Debentures consist of two interest options for the investors to choose from and they rank equal and pari passu to each other, except the interest coupon offered, tenor and the interest period.

4 Years Type A – Fixed interest rate of 9.60% p.a. (AER 9.8304 %) payable semi - annually

from the Date of Allotment until the expiry of four (4) years from the Date of Allotment on the principal sum of the Debenture.

Interest accruing on a daily basis will be paid every Six (06) months from the date of allotment until the date of redemption on the outstanding principal amount

5 Years Type B – Fixed interest rate of 9.95% p.a (AER 9.95%) payable annually from the

Date of Allotment until the expiry of five (5) years from the Date of Allotment on the principal sum of the Debenture.

Interest accruing on a daily basis will be paid each year from the date of allotment until the date of redemption on the outstanding principal amount.

Interest will be paid as per the interest payment option selected by the investor computed up to the Interest Payment Date and interest would be paid not later than three (03) Working Days from each Interest Payment Date.

The interest calculation will be based upon the actual number of days in each interest payment period (Actual / Actual).


In order to accommodate the Debenture interest cycle in the Automated Trading System (ATS), interest payments shall not include the Debenture holders holding Debentures in the ATS as at the last day of the payment cycle (Annual), but one day prior to the due date of interest (entitlement date). If the entitlement date is a holiday, interest shall be calculated including the entitlement date.

1.6 PAYMENT OF PRINCIPAL AND INTEREST Payment of the principal and interest in the debenture will be made in Sri Lankan

Rupees after deducting any taxes and charges thereon (if any) to the Debenture Holders upon receipt of information relating to the Debenture Holders from the CDS as of the payment date (in the case of joint Debenture Holders, the payment will be made to the one whose name stands first in the Register of Debenture Holders) to the registered address with the CDS through Post to the Debenture Holder, by crossed cheques marked “Account Payee Only”

Interest payable on all Debenture options will be made only by cheques within three (3) Business days from the end of each period.

“At maturity / redemption, the payment of the principal along with the balance interest payment due will be made by cheque only”.

However if prior arrangements are made with the debenture holders, an electronic fund transfer mechanisms recognized by the banking system of Sri Lanka such as RTGS (arranged only at the expense of the investor) and SLIPS will be used for payment of principal and interest. RTGS transfers however shall be accommodated only for amounts over and above the maximum value (LKR 5,000,000/-) that can be accommodate via SLIPS transfers.

1.7 REDEMPTION These Debentures are redeemable at maturity on the expiry of four (4) and five

(5) years respectively from the Date of Allotment in accordance with the provisions contained in the Trust Deed.

The Debenture Holders shall not have any right or option to call for redemption of the Debentures before the maturity date of such Debentures,

If the date of maturity / redemption falls on a business day on which the banks are closed for business in Sri Lanka, then the Debentures shall be redeemed on the succeeding day of the date of maturity / redemption together with all the accrued interest thereon up to the preceding Date of Redemption/Maturity of the Debenture.

1.8 TRUSTEES TO THE OFFERING Deutsche Bank AG, Colombo Branch has been appointed as the Trustee to this

Debenture Issue. The Company and the Trustee have executed a Trust Deed. In the application form for subscription of Debentures the applicants are required to irrevocably authorize the trustee, subject to any overriding clauses in the Trust Deed to act as their agent in entering in to such deeds, writing and instruments with the Company and to act as trustee for the benefit of and interest of the Debenture Holders on the terms and conditions contained in the said Trust Deed. The rights and the obligations of the Trustee are set out in the Trust Deed which is hosted on the People’s Leasing & Finance PLC and CSE websites. There is no conflict of interest arising between the Trustee or its Directors and the Entity.


1.9 RIGHTS OF THE DEBENTURE HOLDERS a) Debenture Holders are entitled to the following rights: - Receive principal on the date of maturity / redemption, and interest on the Debenture

as per section 1.5 of this Prospectus and the provisions contained in the Trust Deed. - In accordance with the Listing rules of CSE, receiving copy of the Annual Report of

the Company within a period not exceeding five (5) months from the close of each financial year. Audited accounts will be sent in CD form, unless a specific request for a hard copy is received by the Company.

- In the event of liquidation, rank above the ordinary voting and non-voting shareholders and preference shareholders of the Company.

- Call, receive notice, attend and vote at the meeting of Debenture Holders in accordance with the provisions contained in the Trust Deed.

- The other rights of the Debenture Holders are set out in the Trust Deed.

b) Debenture Holders are not entitled for the following - Attending and voting at meetings of holders of shares and other types of debentures. - Sharing in the profit of the Company - Participating in any surplus in the event of liquidation - The Debenture Holders will not be entitled to any of the rights and privileges

available to the shareholders of the Company including the right to receive notices of Annual General Meetings or attend and vote at the Annual General Meeting of the Company.

c) Obligations on the Debenture - The Company shall repay the principal sum on the date of maturity / redemption and

interest on the Debenture as per section 1.5 of this Prospectus and the provision contained in the Trust Deed and comply with all terms and conditions stipulated in the Trust Deed in respect of these Debentures.

When making payment of the principal sum and interest on the Debentures, the Company shall always act on the information by the CDS and it shall be the responsibility / obligation of each Debenture Holder to keep all the information in respect of such Debenture Holder updated in the CDS. Each Debenture Holder shall absolve the Company, CDS and CSE from any responsibility or liability in respect of any error or absence of necessary changes initiated by the Debenture Holders in the information recorded with the CDS.

1.10 RISK FACTORS ASSOCIATED WITH DEBENTURES

Risk involved in investing in the debentures:

Subscribers to the Debentures will be exposed to the following risks: (It is vital to note however that these risks are not unique to debentures issued by

People’s Leasing & Finance PLC and apply generally to any unsecure fixed income security, fixed deposit or any other term or money deposit)

(a) Interest Rate Risk

The price of a typical Debenture will change in the opposite direction to a change in the market interest rates assuming all other factors are equal. “Market Interest Rate” refers to interest rate expected by the investors for investments with similar maturity and risk profile. As market interest rates rise, price of the Debentures may fall and as market interest rates fall, the price of the debenture may rise. If an investor sells a Debenture prior to maturity when market interest rate is higher than on these Debenture interest rates, the investor may incur a capital loss. Similarly, if an investor sells a Debenture prior to maturity when market interest rate is lower than on the debenture interest rate, then the investor may receive a capital gain. This uncertainty is known as “interest rate risk”.


(b) Reinvestment Risk

The Company shall pay interest on the Debentures semi annually & annually. The investor may decide to reinvest this interest payment and earn interest on interest. Depending on the prevailing market interest rates, the Debenture Holder may be able to reinvest the paid interest at a higher or lower interest rate than that is offered by these Debentures. This uncertainly is known as “reinvestment risk”.

(c) Default Risk

Default risk also known as credit risk refers to the risk that the Issuer of a Debenture may default, i.e. the Issuer will be unable to pay interest and principal when due. It is advisable for prospective People’s Leasing & Finance PLC Debenture investors to take into account past earnings and asset growth performance of the Company, present financial strengths as reflected in the Balance Sheet of the Company, its risk management policies and the experience of the Directors and Senior Management when forming an opinion on Default Risk. The rights of Debenture Holders would be ranked in priority to the subordinated creditors of the Company but after the secured creditors of the Company.

(d) Liquidity Risk

Liquidity risk depends on the ease with which Debentures can be sold after the initial placement. As the Debentures will be listed on the CSE, investors will be able to trade the instrument in the secondary market and convert to cash mitigating liquidity risk. However transaction price or bid-ask spread will be dependent upon the marketability, demand, supply and other macro factors such as market interest rates.

(e) Duration Risk

Duration is a measure of the price sensitivity of fixed income investments to a change in interest rates based on the time to maturity of principal and coupon payments. The higher the duration, the greater the price volatility or duration risk, while a lower duration risk carries a lower risk.

(f) Call Risk

Call risk refers to the risk that the issuer will retire all or a part of the principal value of the Debentures before maturity. The risk to investor is in that the timing of the call is not known and the investor will be faced with a re-investment risk in the event the call is made at a time when the market interest rates have declined.

Since these Debentures shall not be redeemed by the Company prior to maturity for any reason whatsoever except due to unforeseen circumstances beyond the control of the Company, this risk is minimized.

Risk relating to the objectives of the Debenture Issue:

Funds raised through the IPO will be utilized to enhance the working capital of the company. This will, in turn further reduce the Asset & Liability mismatch of the company Balance Sheet and the company is confident of raising the Rs. 6 Bn through the IPO. However if the company fails to raise the targeted amount which is highly unusual, then those funds could be sourced through other borrowing methods such as Securitizations, Bank facilities, short term borrowings & etc. Since the debenture issue amounts to less than 6% of the total asset base of the company, the company doesn’t see material risks involved in non achievement of the objectives described in section 1.4 within the specified time line.


1.11 BENEFITS OF INVESTING IN THE DEBENTURES

- An attractive interest income for a period of up to five (05) years. - Opportunity to realize capital gain according to interest rate fluctuations in the

financial markets. - Capacity to exit from the investment at any time, after the Debentures are listed on

the CSE - Can be used as collateral to obtain credit facilities from banks and financial institution. - As per sections 9 & 13.of the Inland Revenue Act No. 10 of 2006 (as amended

by Section 4 & 5 of the Inland Revenue (Amendment) Act No. 18 of 2013), the profits & interest income from any investment made on or after 01st January 2013 in corporate debt securities (i.e. debentures), quoted in any stock exchange licensed by the SEC is exempt from income tax. However different tax amendment could be brought in by the future amendments to the same act.

1.12 TRANSFER OF DEBENTURES (a) These Debentures shall be freely transferable as long as the Debentures are listed

in the CSE and the registration of such transfer shall not be subject to any restriction, save and except to the extent required for compliance with statutory requirements.

(b) Subject to provisions contained in the Trust Deed, the Company may register without assuming any liability any transfer of Debentures, which are in accordance with the statutory requirements and rules and regulations in force for the time being as laid down by the CSE, SEC and the CDS.

(c) In the case of the death of a Debenture Holder, - The survivor where the deceased was a joint holder; and - The executors or administrators of the deceased (or where the administration of the

estate of the deceased is in law not compulsory, the heirs of the deceased) where such Debenture Holder was the sole or only surviving holder; shall be the only persons recognized by the issuer as having any title to his/her Debentures.

(d) Any person becoming entitled to any Debenture in consequence of bankruptcy or winding up of any Debenture Holder, upon producing proper evidence that such Debenture Holder sustains the character in respect of which such Debenture Holder proposes to act or such Debenture Holder’s title as the Board of Directors of the Company thinks sufficient, may at the discretion of the Board be substituted and accordingly registered as a Debenture Holder in respect of such Debentures subject to the applicable laws, rules and regulations of the Company , CDS , CSE and SEC.

(e) No change of ownership in contravention of the above conditions will be recognized by the Company.

1.13 LISTING An Application has been made and approved in principle by the CSE for permission to

deal in and obtain a quotation for Listed, Rated, Senior Unsecured and Redeemable Debentures at a par value of LKR100/- each, all of which are offered to the public by way of this Debenture issue. The CSE however, assumes no responsibility for the correctness of the statements made or opinions expressed or reports included in this Prospectus. Admission to the Official List is not to be taken as an indication of the merits of People’s Leasing & Finance PLC or of the Debentures issued.

1.14 RATING OF THE INSTRUMENTS Fitch Ratings (Lanka) Limited has assigned a long term rating of AA- (lka) to these

Debentures. A copy of the Rating report issued by Fitch Rating (Lanka) Limited is attached herewith (Annexure – I).


1.15 COST OF THE ISSUE The directors estimate that the total cost of the issue including the Listing fees,

Trustee fees, Brokerage, Printing, Marketing, Stamp duties, Managers and Registrars fees and other costs connected with the issue will be approximately LKR 25 Million and will be funded by People’s Leasing & Finance PLC.

1.16 BROKERAGE & FEES Brokerage at the rate of 0.15% of the nominal value of the Debentures will be paid

in respect of the number of Debentures allotted on applications bearing the original stamp of any bank operating in Sri Lanka or a member/ trading member of the CSE or People’s Bank Investment Banking Unit or NDB Investment Bank Ltd or any agent appointed by the Company involved in marketing of the Issue.

1.17 UNDERWRITING The debenture issue is not underwritten.

In the event the issue is not fully subscribed, the subscribers shall be allotted in full and funds will be utilized to meet the objectives of the issue stipulated in Section 1.4 of the Prospectus.

1.18 INSPECTION OF DOCUMENTS Articles of Association, Trust Deed, Auditors’ Reports and Audited Financial

Statements for the five (05) financial years ended 31st March 2015. (i.e. the five (05) financial years immediately preceding the date of this Prospectus) and all other documents referred to in Rule 3.3.11 (a) of the CSE Listing rules, including material contracts and management agreements entered into by the Company (if any) would be made available for inspection by the public seven (07) Market Days prior to the opening of the subscription list, during normal working hours at the Registered Address of the Company, until the Date of Redemption/Maturity of the Debentures.

The Prospectus, Trust Deed & Articles of Association would be made available to the public, seven (07) Market days prior to opening of the subscription list in the Company’s website, www.plc.lk and the CSE website, www.cse.lk from date of opening until the maturity date of the Debentures as stipulated in rule 3.3.11 (b) of the CSE Listing Rules.

Furthermore, the copies of the Prospectus and Application Form will be made available free of charge from the collection points as set out in Annexure II.


2 PROCEDURE FOR APPLICATION

2.1 ELIGIBLE APPLICANTS Applications are invited for the subscription of Debentures from the following

categories of applicants:

(a) Citizens of Sri Lanka who are resident in Sri Lanka and above 18 years of age.

(b) Companies, corporations or institutions incorporated or established within Sri Lanka and who are authorized to invest in Debentures.

(c) Approved provident funds and approved contributory pension schemes registered / Incorporated /established in Sri Lanka and who are authorized to invest in Debentures. Applications by these bodies must be in the name of the trustee/board of management thereof.

(d) Foreign institutional investors, corporate bodies incorporated outside Sri Lanka, foreign citizens and Sri Lankan residents outside Sri Lanka and above eighteen (18) years of age.

Applications will not be accepted from individuals under the age of eighteen (18)

years, or in the names of sole proprietorships, unincorporated trusts or non-corporate bodies.

The company will ensure compliance with the Exchange Control Act and all regulations published there under including those contained in the Government Gazette Extraordinary No.1864/39 dated 28th May 2014 and Exchange Control Direction No. 06/04/18/2013 dated 12th June 2013 when issuing and transferring Debentures to Non- Residents.

2.2 HOW TO APPLY (a) Applications must be made on the Application Forms issued with this Prospectus.

Applications are also permitted on photocopies of the Application Forms issued with the Prospectus. Applicants using photocopies are requested to inspect the Prospectus, which is available for inspection and also issued free of charge at the Registered Office of the Company and the Collection Points listed in Annexure II.

Prospectus could also be downloaded from the Company’s and CSE’s websites (www.plc.lk & www.cse.lk) until the date of redemption of the Debentures

Application Forms could also be downloaded from the Company’s and CSE’s websites (www.plc.lk & www.cse.lk) until the closure date

Applications that do not strictly conform to such instructions and the other instructions set out below or which are illegible may be rejected.

(b) Applications should be made for a minimum subscription value of Sri Lanka Rupees Ten Thousand (LKR 10,000) of One Hundred (100) Debentures each of any one type or all types mentioned above. Applications exceeding One Hundred (100) Debentures should be in multiples of One Hundred (100) Debentures (LKR 10,000). Applications for less than One Hundred (100) Debentures or for a number, which is not in multiples of One Hundred (100) Debentures, will be rejected.

(c) Joint Applications may be made. However, an applicant of a joint application will not be eligible to send a separate application individually or jointly with another party.


Only one Application should be made for the benefit of any person or corporate body. The interest payments will be made in favour of the principal applicant as given in the Application Form.

(d) In the case of Corporate Applicants, the common seal of the company should be affixed and attested if required by the Articles of Association or such other constitutional documents of such Applicants or as per the statutes governing them. In case of approved provident funds, trust funds and approved contributory pension schemes, the Applications should be in the name of the Trustees / Board of Management.

(e) A Sri Lankan citizen must state his / her National Identity Card (NIC) number on the Debenture Application Form. The Passport number can be given only when the NIC number is not available. In the case of a corporate entity, the Company registration number must be given. A foreign citizen must state his / her passport number in the space provided.

(f) The Application Forms may be signed by someone on behalf of the Applicant(s) provided that such person holds the Power of Attorney (POA) of the Applicant(s). A copy of such POA certified by a Notary Public as “True Copy” should be attached with the Application Form. Original of the POA should not be attached.

(g) Applicants who wish to apply through their Margin Trading Account should submit the application in the name of the “Margin Provider / Applicants Name” signed by the margin provider. A copy of the margin Trading Agreement should be attached with the Application Form. Please note that the margin provider can apply under its own name and such Applications will not be construed as multiple Applications. Photo copy of the Margin Trading Agreement must be submitted along with the Application.

(h) As per the Directive of the SEC made under Circular No. 08/2010, dated 22 November 2010 and Circular No. 13/2010 issued by the CDS dated 30th November 2010, all Debentures allotted must be directly uploaded to the CDS accounts. As such, all applicants should indicate their CDS account number in the Application Form.

Applicants who do not have a CDS account are advised to open a CDS account prior to submitting the Application, in order to facilitate the uploading of allotted Debentures to their CDS account. A CDS account can be opened through any member/ trading member of the CSE or through a custodian Bank. (Annexure II)

Please note that upon the allotment of Debentures under this issue the allotted Debentures would be credited to the applicant’s CDS account so indicated after reconciliation. Please note that Debenture certificates shall not be issued. Applications which do not carry the CDS account number, which is not opened at the time of the closure of the subscription list or which indicate an incorrect / inaccurate CDS account number shall be rejected, and no allotment will be made. In the event that the name, address or NIC number/passport number/company number of the Applicant mentioned in the Application Form differ from the name, address or NIC number/passport number/company number as per the CDS records, the details as per the CDS records will prevail and be considered as the name, address or NIC number/passport number/company number of such applicant.

It should be noted that in the event the Applicant’s CDS Account number is correctly stated in the Application Form, all correspondence with such Applicant will be sent to the address given to the CDS by such Applicant.


Further in the event the name or the address of the Applicant mentioned in the Application Form differ from the name or address given to the CDS by such Applicant in respect of the CDS Account mentioned in the Application Form, the name and the address given to the CDS by such Applicant in respect of the CDS Account mentioned in the Application Form will be considered as the name and address of such applicant.

(i) Foreign Investors and Non-Resident Investors may be affected by the laws of the

jurisdiction of their residence. It is the responsibility of such investors to comply with the laws relevant to their country of residence and the Laws of Sri Lanka, when making an Application for subscription of the Debentures.

(j) Application Forms properly filled in accordance with the instructions thereof together with the remittance (cheque, SLIPS, bank draft, RTGS or bank guarantee as the case may be) for the full amount payable on application should be enclosed in an envelope marked “People’s Leasing & Finance PLC – Debenture Issue 2015” on the top left hand corner in capital letters and dispatched by post or delivered by hand to the Registrars to the Issue at the following address:

SSP Corporate Services (Pvt) Limited No. 101, Inner Flower Road, Colombo 3 Tel : +94(011) 2573894 Fax : +94 (011) 2573609

In the alternative, Application Forms could also be handed over to any of the Collection Points set out in Annexure II.

(k) Applications sent by post or delivered to any places mentioned in Annexure II

(Collection Points) should reach the office of the Registrars to the Issue at least by 4.30 p.m. on the following working day upon the closure of the subscription list. Applications received after the said period will be rejected even though they have been delivered to any of the Collection Points prior to the Closing Date or carry a post mark dated prior to the Closing Date.

2.3 MODE OF PAYMENT

(a) Payment should be made separately in respect of each application only by way of cheque, SLIPS, bank draft, RTGS or bank guarantee only, as the case may be. Application Forms accompanied by cash will not be accepted.

(b) Payments for applications for values above and inclusive of Sri Lanka Rupees One Hundred Million (LKR 100,000,000/-) should be supported by either a;

- Bank guarantee issued by a licensed Commercial Bank; or - Multiple bank drafts/cheques drawn upon any licensed Commercial Bank operating

in Sri Lanka, each of which should be for a value less than LKR 100,000,000/-; or - RTGS transfer with value on the issue opening date.

Multiple cheques or RTGS transfers will not be accepted for application value below Sri Lanka Rupees One Hundred Million (LKR 100,000,000/-).


(c) The amount payable should be calculated by multiplying the number of Debentures applied for by the issue price of LKR 100 per Debenture. If there is discrepancy in the amount payable and the amount specified in the payment mode (Cheque / Bank Draft / RTGS / Bank Guarantee), the Application will be rejected.

(d) All cheques/bank drafts/bank guarantees received in respect of the applications will be banked on the next working day immediately after the closure of the Subscription List. Payments in any form other than as mentioned above will not be accepted (except for RTGS transfers). In the event cheques are not realized within two (2) market days from the closure of the subscription list, such Applications may be rejected in order to facilitate the completion of the allotment within seven (7) market days of the closure of the issue, and cheques realized after such date will be refunded and no allotment of Debentures will be made.

(e) In case of RTGS transfers (only for application values above and inclusive of Sri Lanka Rupees One Hundred Million (LKR 100,000,000/-), such transfers should be made to the credit of “People’s Leasing & Finance PLC – Debenture Issue 2015 -01 ”bearing Account Number 331100350002513 at People’s Bank Lucky Plaza Branch with value on the issue opening date (i.e. the funds to be made available to the above account on the issue opening date). The applicant should obtain a confirmation from the applicant’s bank, to the effect that arrangements have been made to transfer payment in full for the total value of Debentures applied for to the credit of “People’s Leasing & Finance PLC – Debenture Issue 2015 - 01” bearing Account Number 331100350002513 at People’s Bank Lucky Plaza Branch with value on issue opening date (i.e. the funds to be made available to the above account on the issue opening date) and should be attached with the application form. For RTGS transfers above and inclusive of Sri Lanka Rupees One Hundred Million (LKR 100,000, 000/-), the applicants are entitled to an interest at the rate of Standing Deposit Facility Interest Rate (applicable on the allocation date) minus 2% per annum from the date of such transfers up to the date of allotment will be paid to the respective investors. However, no interest will be paid if the RTGS transfers are not realized before the end of the closure date. Furthermore, even if such RTGS transfers are affected prior to the issue opening date, no interest will be paid for the period prior to the issue opening date.

(f) The Bank Guarantees should be in a form acceptable to the Company and the Registrars to the Issue and should be issued by a licensed commercial bank in Sri Lanka and payable on demand unconditionally to “People’s Leasing & Finance PLC – Debenture Issue 2015 - 01”. Please note that Bank Guarantees should be valid for a minimum of one (1) month from the date of opening the issue.

(g) Payments for the Debentures by Non- residents should be made only out of funds received as inward remittances or available to the credit of “Securities Investment Account” (SIA) maintained with any licensed commercial bank in Sri Lanka in accordance with directions given by the Controller of exchange in that regard to the licensed commercial banks as per the Government Gazette Extraordinary No. 1864/39 dated 28 May 2014. An endorsement by way of a letter by the commercial bank in Sri Lanka in which the applicant maintains the SIA, should be attached to the application form to the effect that such payment through bank draft/ bank guarantee/ RTGS has been made out of the funds available in SIA.

(h) Non-Residents should have obtained necessary internal approvals as provided by their internal approval procedures at the time of applying for the Debentures and may be affected by the laws of the jurisdiction of their residence.


If the Non-Resident Applicants wish to apply for the Debentures, it is their responsibility to comply with the laws relevant to the jurisdiction of their residence and of Sri Lanka.

Application Forms properly filled in accordance with the instructions thereof together with the remittance for the full amount payable on Application should be enclosed in an envelope marked “People’s Leasing & Finance Plc – Debenture Issue 2015” on the top left hand corner in capital letters and dispatched by post or courier or delivered by hand to the Registrars to the Issue or collection points mentioned in Annexure II.

Applications sent by post or courier or delivered to any collection point set out in Annexure II should reach the office of the Registrars to the Issue, SSP Corporate Services (Pvt) Ltd, No 101, Inner Flower Road Colombo 03 at least by 4.30 p.m. on the following Market day immediately upon the Closing Date.

Applications received after the said period will be rejected even though they have been delivered to any of the said collection points prior to the Closing Date or carry a postmark dated prior to the Closing Date. Applications delivered by hand to the Registrars to the Issue after the Closing Date of the Issue will also be rejected.

2.4 REJECTION OF APPLICATIONS

(a) Application Forms and the accompanying remittance mode (Cheque / Bank Draft / RTGS / Bank Guarantee) which are illegible or incomplete in any way and / or are not in accordance with the terms, conditions and instructions set out in this Prospectus will be rejected at the sole discretion of the Company.

(b) Applications from individuals under the age of eighteen (18) years or in the names of Sole Proprietorships, Partnerships or Unincorporated Trusts will also be rejected.

(c) An Applicant of a Joint Application will not be eligible to submit another application either individually or jointly under the available Debenture category. Only one Application should be made by any person or entity under the available Debenture category. Multiple Applications will be rejected.

(d) Applications which do not carry a valid CDS account number at the time of the closure of the subscription list or which indicate an incorrect / inaccurate CDS account number shall be rejected, and no allotment will be made. Application Forms stating third party CDS account numbers, instead of their own CDS account numbers, except in the case of Margin Trading Accounts, will also be rejected.

(e) Any Application Form which does not state the NIC, Passport or Company Registration number, as the case may be, will be rejected.

(f) In the event that cheques are not realized within two (2) Market Days from the closure of the subscription list and realized after such date the monies will be refunded and no allotment of Debentures will be made. Cheques must be honored on first presentation for the Application to be valid. In the event Cheques are dishonored / returned on first presentation, the Application will be rejected.

(g) Applications delivered by hand to the Registrars to the Issue, or to any place / institution discussed in Annexure II (Collection Points) after the subscription list is closed will be rejected. Application received by post or courier after 4.30 p.m on the Market day immediately following the closing date, will also be rejected even if they


carry a post mark dated prior to the Closing date.

(h) Applications delivered to any place / institution discussed in Annexure II (Collection Points) should also reach the office of the Registrars to the issue at least by 4.30 p.m on the following market day immediately upon the closure of the Subscription List. Applications received after the said duration will be rejected even though they have been delivered to any of the Collection points prior to the Closing Date or carry a post mark dated prior to the Closing Date.

2.5 BASIS OF ALLOTMENT

The basis of Allotment will be decided by the Board of Directors of The Company before the expiry of Seven (07) Market Days from the closure of the Issue and will be announced to the CSE.

Further, the Board reserves the right to allocate maximum of 50% of the issue value on a preferential basis, to investor/(s) of strategic importance with who they might partner with in future endeavors.

The successful applicants will be informed of the allotment within Ten (10) Market Days from the closure of the Subscription List.

The Board of Directors of the Company reserves the right to refuse any Application or to accept any Application or part only, without assigning any reason therefore.

2.6 ACCEPTANCE & REFUNDS

Where an Application is not accepted, subsequent to the Cheque being realized, the applicant’s money in full or where an Application is accepted only a part, the balance of the Applicant’s money will be refunded.

Refunds due on Applications fully or partially accepted will be paid within Ten (10) Market Days excluding the date of closure of the Subscription List. Applicants will be entitled to receive interest at the rate of last quoted Average Weighted Prime Lending Rate (AWPLR) published by the Central Bank of Sri Lanka plus 5% for the delayed period on any refunds not made within this period.

If the Applicant has provided accurate and complete details of his bank account in the application form, the banker to the issue will make refund payments up to and inclusive of Sri Lankan Rupees Five Million (LKR 5,000,000/-) to the bank account specified by the Applicant, through SLIPS.

In the event of refunds over Rupees Five Million(LKR 5,000,000/-), refunds will be made via RTGS. In the event where the Applicant has not provided accurate and correct details of his bank account in the Application Form, the bank will make such refund payments to the Applicant by way of cheque and sent by post at the risk of the Applicant.

Refunds sent through post will be made by crossed cheques and sent by register post to the registered address. In the case of a Joint Application, a “Crossed Cheque” will be drawn in favour of the applicant whose name appears first in the Application Form.

Applicants can obtain details on bank and branch codes required for providing


instructions on SLIP transfers at the following website;

http://www.lankaclear.com/product service/3-guidelines

Refunds on payments received via Securities investment Account (SIA) will be made only to the SIA in the event that the SIA account has been provided in the Debenture application form

2.7 CDS LODGEMENTS AND TRADING OF DEBENTURES

(a) If the Applicant’s CDS Account number is correctly stated in the Application Form the Debentures allotted will be directly uploaded to the CDS account stated in the Application Form before the expiry of eighteen (18) market days, from the date of closure of the subscription list. A written confirmation in this regard will be sent to the Applicant within two (02) market days of crediting the CDS account, by ordinary post to the registered address of such Applicant.

(b) The Company shall submit to the CSE a ‘Declaration’ as set out in the listing rules of the CSE on the market day immediately following the day on which the investors’ CDS Accounts are credited with the Debentures and trading of the Debentures will commence on or before the third (03rd) Market Day upon receipt of the declaration by the CSE.


3 THE COMPANY

3.1 INCORPORATION People’s Leasing & Finance PLC is a Limited Liability Company, which was

incorporated in Colombo on 22nd August 1995 as a Private Company.

3.2 CORPORATE PHILOSOPHY

• Company Vision To become legendary in the financial service scene as a provider of customer-

friendly, creative and innovative total solutions.

• Company Mission Dedicated value-added customer service to accomplish organizational service

excellence whilst maintaining a sustainable competitive advantage.

3.3 CORPORATE BACKGROUND People’s Leasing & Finance PLC was incorporated in Sri Lanka in 1995 as a fully

owned subsidiary of People’s Bank, with the intention of facilitating leasing and other related services to People’s Bank customers. The Company was registered as a Specialized Leasing Company (SLC) under section 34 of the Finance Leasing Act No. 56 of 2000. Since then during the past 16 years, the Company has excelled in all spheres of leasing and currently established itself as one of the best leasing companies in the leasing industry in terms of annual disbursements. (Source: Leasing Association of Sri Lanka).

In compliance with the regulatory requirements of the Monitory Board of CBSL, the Company made a transition from a limited liability company to a public quoted company and was listed on the Colombo Stock Exchange. However, the Company still enjoys a major competitive advantage over other players due to it being operated as the flagship subsidiary of the People’s Bank, one of the largest state banks in Sri Lanka. In October 2012, the company was renamed from “Peoples Leasing Company PLC” to “Peoples Leasing & Finance PLC” as a result of gaining approval and license from the CBSL to carry on finance business.

The Group’s products and services are diversified into Leasing and Hire purchase, insurance, property development, Islamic Finance, Microfinance and Fleet Management services. The Company has developed an enviable track record of performance in these business areas as a “Total Financial Services provider” in the market.

PLC successfully faces the stiff competition existing in the industry by offering tailor-made services to customers and by taking advantage of the ideal formula of private sector dynamism coupled with public sector stability. As a result, PLC possesses a loyal and rapidly growing customer portfolio and has driven itself to be one of the best leasing companies in the leasing industry and, becoming a benchmark for leasing companies in Sri Lanka. Recently the Company has successfully expanded the geographical reach by increasing its branch network up to 89 across the country. In addition, PLC is fledged with 109 window offices located in People’s Bank branches all over the country including north and eastern provinces.


Accordingly, the excellent track record of performance coupled with a strong credit profile has enabled the Company to bear a long term rating of ‘B+/AA- (lka) Stable’ from Fitch. The Company has also secured the distinction of being the only Sri Lankan Non-Banking Financial Institution (NBFI) to secure two international credit ratings with a one equal to the Sovereign from Standard & Poor’s (‘B+/B” Rating) and the other one notch below Sovereign from Fitch Ratings International (‘B+’ Rating); both with a “stable” outlook. Further the company was rated AA- by Brand Finance UK in May 2010 and is considered by the Credit Information Bureau of Sri Lanka as a model entity for data accuracy having being rated A+ for data quality.

3.4 GROUP STRUCTURE

As the holding Company, People’s Leasing & Finance PLC owns 5 subsidiaries and one associate as follows;

People’s Leasing & Finance PLC

100% 37.6%100% 100%100% 100%

People’s Microfinance

Ltd

75%

People’s Insurance

Ltd

People’s Leasing Fleet Management

Ltd

People’s Leasing Property

Development Ltd

People’s Leasing

Havelock Properties

Ltd

People’s Merchant

Finance PLC


People’s Leasing Fleet Management Ltd - Providing operating leases, vehicle service, hiring / renting of vehicles and vehicle valuations

People’s Leasing Property Development Ltd - Carrying out mixed development projects

People’s Leasing Havelock Properties Ltd - Construction and operation of office complexes.

People’s Microfinance Ltd - Providing financial services excluding banking business to low income earners, assisting and promoting micro enterprise development among low income populations and conducting skill development programs to unemployed youth, foster social / financial inclusivity.

People’s Insurance Ltd - Providing general insurance

People’s Merchant Finance PLC – an Associate Company offering financial products to the market

3.5 FUTURE PLANS RISKS AND ASSUMPTIONS

Assumptions on which future strategies are based / Business Trends

The PLC Group has now become a leading financial conglomerate in Sri Lanka with 5 established fully owned subsidiaries united under the PLC name. Through these subsidiaries, the Group has a ‘one- stop’ product offer - leasing and finance services, insurance, micro finance, fleet management and property development to its valued Customers .Today, PLC is privileged to serve its customers through head office in Colombo, 89 branches and 109 window offices across the island, touching lives of many, especially in the rural areas and enabling its customers to withdraw through its Parent’s ATM network. PLC and its 5 fully owned subsidiaries’ business activities are currently based in Sri Lanka.

The comprehensive product range extended by PLC has a substantial value creation capacity. The product suite, which was further, braced post-merger and finance company license obtained in the year 2012, offers a versatile set of financial solutions to diverse customer segments, particularly targeting the small and medium enterprises sector. Leases, the core product, supports customers to acquire vehicles, machinery and equipment for commercial as well as for personal purposes; hire purchase and loans, to a lesser extent, also complements this process whilst a range of deposit products enables investment and saving solutions. Islamic finance supports customers who prefer and believe in nonconventional solutions based on Shari’ah principles. New products like margin trading are also making way for more financially savvy customers seeking investment options within the country’s emerging capital markets.

As per the product mix, presently the core product, leasing inclusive of finance leases and Ijara under Islamic finance continued to dominate, accounting for over 55.65 percent of the total disbursements. As was the case in the recent years, term loans continued to gain in momentum with disbursements posting an outstanding growth, highest within the portfolio, a share of 26.24 percent of the total. However hire purchase as a product is abandoned currently.


Future Strategies

Expansion of Branch Network

Pursuing its top- line strategy, PLC will look to further consolidate the branch network and leverage on the expansiveness of its outreach. PLC will also seek to expand its outreach to untapped markets whilst rationalising the network with due relocations and new branches in areas that have the highest concentration of potential customers.

PLC plans to decentralise the administration function under four regional heads, managing the branches on a cluster- basis thus enabling effective strategy implementation and cost rationalization. PLC will continue to be bullish on its diversification initiatives, particularly concentrating on margin trading and taking- off factoring as a new product. PLC also plans to build its brand presence with focused branding campaigns and take on business development initiatives to attract customers as well as investors both locally and internationally.

In the medium to long term, PLC plans look beyond the country’s border especially moving into the South Asian region.

Portfolio Performance

The non - performing ratio of 2.72 percent was maintained below the targeted ratio at less than 3 percent and was closer to the ratio of 2.18 percent posted in the previous year (Source : Annual Report of PLC 2014/15). More so, the ratio was remarkably well below the industry average of 6.9 percent (Source: Annual Report 2014, Central Bank of Sri Lanka). Apart from the top- line initiatives, PLC will remain committed to be prudent in managing the quality of its portfolio with the non performing ratio being within target and well below the industry average.

Funding Strategy

PLC will seek to adopt effective funding strategies, responsive to market dynamics and thereby, ensure the strength of its financial position. PLC’s approach looks to structure a right mix in funding that would cap maturity mismatches between assets and liabilities. The strategy of the company is to raise more long term funds by retiring short term funds in order to capitalise on the low interest rate environment.

Deposits

In the backdrop of PLC’s diversified aspirations and expansionary plans, deposit taking is expected to continue in its strategic role within the Company. Plans are focused on growing market share reaching out to its customer base across the branch network including tapping into the microfinance customer base.

Margin Trading

In an evolving economy, capital markets are expected to play a pivotal role in supporting the country’s development goals. Ironing out the prevailing uncertainties in the short term, the market is expected to be buoyant with greater movement along with stability. In this scenario, PLC is firm in its efforts to position margin trading operations as a significant player within the industry, especially seeking to be inclusive in its approach opening up opportunities for a diverse customer base to gain higher returns on the market.


Al-Safa Islamic Financial Services (AIF)

PLC is aligned to the corporate strategy of being a diversified and an inclusive organisation, Al-Safa Islamic Financial Services (AIF) is PLC’s specialised unit operating in line and in compliance with Shari’ah principles prescribed by the Accounting & Auditing Organisation for Islamic Financial Institutions.

Within a competitive operating environment, AIF unit progressively moved forward to establish a firm presence with the brand ‘Al-Safa’ growing in strength within the marketplace. With changes in demographic patterns along with new socio-cultural perceptions, the demand for Islamic finance products will continue in its upward trend and lucrative market opportunities.

Risks & Uncertainties associated with such future strategies

In an emerging political and socio economic landscape in the post conflict Sri Lanka, businesses are presented with a range of opportunities to grow and prosper. Yet, businesses are also challenged with risks and uncertainties that could compromise the sustainability of operations. Recognizing this, the management at PLC is proactive and has been successful thus far, in its response availing the opportunities for growth and diversification whilst exercising caution in its business decisions with checks and balances to minimise the material risks that could impact on its performance and even impede the progress towards being a sustainable organisation.

Below are the principal risks and uncertainties that stand as the backdrop to decision making process,strategy formulation, drawing up corporate’s action plans and in its day- to- day operations

Industry Competition

Overcrowded industry with banking and non-banking institutions seeking to offer similar products and services thus eroding the market share and margins. Banking sector has the access to low cost funds than that of non-banking sector.

Funding - Cost & Maturity Mismatches

High cost of funds within the non – bank finance sector impacting competitiveness whilst being susceptible to maturity mismatches in assets and liabilities arising due to the lack of long term funds to finance long term lending.

Volatility in Macroeconomic Environment

Susceptibility to volatilities in interest rates and exchange rates with implications on planned interest income, expenses and the capital base and the changes in duty structure on vehicle imports directly impact the core leasing and hire purchase operations.

Changes in Regulations

Constantly changing regulatory framework brings in uncertainties to operations, expansions, top- line and bottom- line results and future plans.

Turnover in Trained Staff

Intense competition leading to high turnover of trained and expert staff within the industry.


3.6 SHARES IN ISSUE AND STATED CAPITAL

As at 30th September 2015 the stated capital of the Company is Sri Lankan Rupees 13,236,073,308/- and the company has LKR 200 million worth of fully paid, Cumulative redeemable preference shares outstanding as at the same date.

Capital 13,036,073,308.00 Preference share capital 200,000,000.00 Stated Capital 13,236,073,308.00

Total number of ordinary shares outstanding as at 30th September 2015 is 1,579,862,482 and total number of fully paid cumulative redeemable preference shares outstanding is 20,000,000.

As at 30th September 2015 the public holding of the Company was 24.84%.

3.7 MAJOR SHAREHOLDING

Top Twenty shareholders of the company as at 30th September 2015 are as follows:

Name Shareholding % Holding

People’s Bank 1,184,896,862 75.00

BNYM SA/NV – Neon Liberty Lorikeet Master Fund LP 63,069,853 3.99

National Savings Bank 44,990,757 2.85

Employees Provident Fund 43,643,831 2.76

HSBC Intl Nom Ltd - SSBT Wasatch Frontier Emerging Small Countries Fund 24,753,100 1.57

Bank of Ceylon No 1 Account 11,453,600 0.72

Frontier Market Opportunities Master Fd,L.P 10,150,000 0.64

BNY-CF Ruffer Investment Funds : CF Ruffer Pacific Fund 10,000,000 0.63

Mellon Bank N.A-Acadian Frontier Markets Equity Fund 8,329,273 0.53

Northern Trust Company S/A Ashmore Emerging Markets Frontier Equity Fund 8,183,492 0.52

Mr. Indra Silva 7,445,555 0.47

BNYM SA/NV-Frontier Market Select Fund Ii L.P 7,370,008 0.47

AIA Insurance Lanka PLC A/C No.07 5,376,721 0.34

CEYLON INVESTMENT PLC A/C # 01 4,954,891 0.31

BNYM SA/NV-NLCF FUND LP 4,916,003 0.31

Sri Lanka Insurance Corporation Ltd-General Fund 4,033,000 0.26

Union Assurance PLC A/C No-01 3,821,672 0.24

CB NY S/A Wasatch Frontier Emerging Small Countries Cit Fund 3,732,745 0.24

Northern Trust Global Services Ashmore Sicav Emerging Markets Frontier Equity Fund A Sub Fund of Ash 2,383,305 0.15

Deutsche Bank AG Candorl Growth Fund 2,358,804 0.15


3.8 SUBSIDIARIES/ASSOCIATE COMPANIES AS AT 30TH SEPTEMBER 2015. The company has five 100% own subsidiaries under its wing as at above date.

Details of those as follows

Subsidiaries of the Company

People’s Insurance Ltd – Fully owned subsidiary People’s Leasing Property Development Ltd – Fully owned subsidiary People’s Leasing Fleet Management Ltd – Fully owned subsidiary People’s Micro Finance Ltd – Fully owned Subsidiary People’s Leasing Havelock Properties Ltd – Fully owned subsidiary

Associate Companies

People’s Merchant Finance PLC

3.9 HUMAN RESOURCES Strength of the Human Resource of People’s Leasing & Finance PLC as at 30th

September 2015 is as follows

Management level No of EmployeesSenior Managers 28Line Managers 100Executive 287Non- Executive 1205Minor Staff 71Total 1691

The employees of the entity are not engaged in any labour union activities and there are no labour unions or any significant agreements entered into between the Company and any labour unions.

3.10 DIVIDEND POLICY The dividend policy will be determined based on number of factors, including but

not limiting to the Company’s earnings, capital requirements and overall financial condition and any other factors which the Board of Directors may deem relevant. Details of dividend payments during the preceding financial years have been stated under “Dividend” in Accountants’ Report of this Prospectus.

3.11 INTEREST COVER RATIO

Year Ratio2010/11 2.04%2011/12 1.60%2012/13 1.41%2013/14 1.39%2014/15 1.58%


3.12 DEBT SERVICING POLICY 30TH SEPTEMBER 2015

Item Year 1-2013 Year 2-2014 Year 3-2015

1. Gross interest due on debentures 771,809,452.05 1,080,867,311.64 294,067,352.74

2. Debenture interest paid on due date 771,809,452.05 1,080,867,311.64 294,067,352.74

3. Debenture interest paid after due date Nil Nil Nil

4. Debenture interest not paid as of to date Nil Nil Nil

3.13 DEGREE OF DEPENDENCE ON KEY CUSTOMERS AND SUPPLIERS

People’s Leasing & Finance PLC adheres to prudential requirements set out by the regulator, by virtue of which exposure to any one group of companies, anyone company and customer or any one sector for income at any given time. People’s leasing & Finance PLC is also not significantly dependent on any single supplier for its requirements. The Company made every effort to ensure on quality of the loan book instead of just increasing the loan book. The Company implemented appropriate strategies to face increasing turbulence in the market place while executing the relationship marketing strategies to cope with change in the customer’s and its supplier’s behavior.

3.14 TAXATION The Company is not enjoying any tax concessions or tax exemptions as at the date

of the Prospectus.

3.15 LITIGATION, DISPUTES AND CONTINGENT LIABILITIES

There are no legal, arbitration or mediation proceedings, which may have or have had in the recent past, affected the financial position or profitability of the Company. As at date there are no penalties imposed by any regulatory and/ or state authorities.

As at 30th September 2015, the Company has no contingent liabilities that would materially affect current and future profits.

3.16 MATERIAL CONTRACTS

The Company has not entered into any material contracts other than those contracts entered into in the ordinary course of business.


3.17 TRANSACTIONS RELATED TO PROPERTY

There are no transactions related to the property that took place within the two preceding years in which any vendor of the property to the Company or any person who is or who was at the time of the transaction, a promoter or a director or proposed director of the Company had any interest, direct or indirect.

3.18 DETAILS OF COMMISSIONS & BENEFIT PAID

The Company had paid total of approximately Sri Lanka Rupees 52 Million & 13.109 Million as Managers Fees and Brokerage to raise Sri Lanka Rupees 6 Billion and 3 Billion for the Debentures Issued in the years 2013 & 2014 respectively.

No other commissions or benefits were payable, paid, given or intended to be paid or given in two preceding years for subscribing or agreeing to subscribe or procuring or agreeing to procure or promoting or agreeing to promote, subscriptions for any shares or debentures of the Company.

3.19 CORPORATE GOVERNANCE PRACTICES

The Company is committed to highest standards of corporate governance and believes that such standards are vital to ensure high performance across all dimensions of operations and in relation to people and the communities in which it operates. These standards are encapsulated in Company’s governance charters, policies and documents.

The Board has ensured that the Company complies the Code of Best Practice on Corporate Governance issued jointly by the Institute of Chartered Accountants of Sri Lanka and the Securities and Exchange Commission of Sri Lanka; Corporate Governance Rules embedded in the Listing Rules of the Colombo Stock Exchange; Finance Companies (Corporate Governance) Directions No. 3 of 2008, No. 4 of 2008 and No. 6 of 2013 issued by the Central Bank of Sri Lanka; and the emerging best practices being followed worldwide.

The Company has in place an internal governance structure with defined roles and responsibilities. Through this structure, the Board balances its role of providing oversight and guidance to the management in strategy implementation, risk management and meeting stakeholder expectations. The governance structure provides for delegation of authority whilst enabling the Board to retain effective control. The Board delegates authority to relevant board committees and to the management with clearly defined mandates and authorities.

Board Committees facilitate the discharge of Board responsibilities and provide in-depth focus on specific areas. Each Committee has a mandate setting out its role, responsibilities, scope of authority, composition, and procedures. The Committees’ report to the Board through their respective chairmen and minutes of all committee meetings are submitted to the Board.

Board Audit committee (BAC)

BAC assists the Board of Directors in its general oversight on financial reporting, internal & external audit, and compliance with legal and regulatory requirements, internal controls and governance.

All the members of BAC are non- executive directors. The Chief Executive Officer, Senior Management Committee members and internal and external auditors attend the meetings by invitation.


Members of the Audit Committee are as follows, Mr. Jehan P. Amaratunga - Chairman (Non-Executive, Non-Independent Director) Mr. M. Pradeep Amirthanayagam (Non-Executive, Independent Deputy Chairman) Mr. M. A. M. Rizwan (Non-Executive, Non-Independent Director)

Mr. Udesh Gunawardena, the Assistant General Manager Audit acts as the Secretary to the Board Audit Committee.

Remuneration and Nomination Committee (RNC)

RNC operates within Board approved terms of reference and assists the Board of Directors in ensuring that remuneration arrangements in the Company align reward with performance and support and advise the Board on selection of Board members.

Members of the Committee are as follows,

Mr. J. P. Amaratunga – Chairman (Non-Executive, Non-Independent Director) Mr. M. P. Amirthanayagam - (Non-Executive, Independent Deputy Chairman) Mr. J. A. Fernando - (Non-Executive, Independent Director)

Integrated Risk Management Committee (IRMC)

IRMC is delegated with the responsibility of reviewing and assessing the adequacy and effectiveness of the risk profile of the Company and the Group. The Company has a risk management system which is reviewed on a regular basis by the Board of Directors to facilitate the changes in the business environment. IRMC proceedings are based on the terms of reference and risk management policy adopted by the Board of Directors for the functioning of the IRMC.

Members of the IRMC are as follows;

Mr.M.P.Amirthanayagam Chairman (Non- Executive, Independent Deputy Chairman) Mr. N. Vasantha Kumar (Non- Executive, Non- Independent Director) Mr. D.P. Kumarage (Chief Executive Officer/General Manager) Mr. Sanjeewa Bandaranayake (DGM-Finance & Administration) Mr. Lionel Fernando (DGM-Operations) Mr. Rohan Tennakoon (DGM-Business Development & Marketing)

Related Party Transaction Review Committee (RPTRC)

With the voluntary adoption by the Company of the Code of Best Practices on Related Party Transactions – December 2013 issued by the Securities and Exchange Commission of Sri Lanka, which was subsequently incorporated into the Listing Rules of the Colombo Stock Exchange, RPTRC was established by the Board in early 2014 to ensure strict compliance with the rules and regulations governing Related Party Transactions for Listed Entities and thus improve its internal control mechanisms. Accordingly, RPTRC is responsible for the review in advance of all proposed Related Party Transactions other than those transactions explicitly exempted in its Terms of Reference which are in conformity with the Listing Rules.

Members of the RPTRC are as follows,

Mr. M. P. Amirthanayagam – Chairman (Non- Executive, Independent Director) Mr. J. A. Fernando - (Non- Executive, Independent Director) Mr. M. A. M. Rizwan - (Non- Executive, Independent Director)


Appointments to the Board

Recognising that careful management of the Board’s succession process is vital to the successful evolution of the Board, the Board plans for its own succession with the assistance of the Remuneration and Nomination Committee. The Corporate Governance Charter and the Articles of Association of the Company provides for a comprehensive procedure applicable to the selection and appointment of Directors.

3.20 PARTICULARS OF DEBT AND LOAN CAPITAL Term Loans of PLC as at 30th June 2015

Lending Institution

Loan Granted Amount (Rs.)

Capital Outstanding

as at 30.06.2015

(Rs.)

Amount Repayable

within 1 Year

Amount Repayable after 1 Year

Axis Bank 320,000,000 201,800,000 90,000,000 111,800,000

Commercial Bank 2,000,000,000 1,833,333,332 500,000,004 1,333,333,328

Commercial Bank 1,000,000,000 50,000,000 50,000,000 -

Commercial Bank 750,000,000 421,875,000 187,500,000 234,375,000

Commercial Bank 3,000,000,000 2,500,000,000 750,000,000 1,750,000,000

Commercial Bank 1,000,000,000 791,670,000 249,996,000 541,674,000

Indian Bank 250,000,000 3,700,000 3,700,000 -

Indian Overseas Bank 500,000,000 343,750,000 125,000,000 218,750,000

Indian Overseas Bank 550,000,000 40,000,000 40,000,000 -

Indian Oversease Bank 650,000,000 284,800,000 185,800,000 99,000,000

HNB Bank 2,000,000,000 1,791,650,000 500,040,000 1,291,610,000

People’s Bank 1,500,000,000 1,343,750,000 375,000,000 968,750,000

People’s Bank 4,250,000,000 4,161,000,000 1,068,000,000 3,093,000,000

Sampath Bank 1,000,000,000 124,997,200 124,997,200 -

Sampath Bank 2,000,000,000 1,800,002,000 399,996,000 1,400,006,000

Seylan Bank 500,000,000 51,866,061 51,866,061 -

21,270,000,000 15,744,193,593 4,701,895,265 11,042,298,328


Foreign Loans of PLC as at 30th June 2015

Lending Institution

Loan Granted Amount

Capital Outstanding as at 30.06.2015

(Rs.)

Amount Repayable within

1 Year

Amount Repayable after

1 Year

Emirates NBD Bank USD 50 million 2,473,357,500 2,473,357,500 -

Short Term Loans of PLC as at 30th June 2015

Lending Institution

Loan Granted Amount (Rs.)


(Rs.)


1 Year


1 Year

Nation Trust Bank 1,200,000,000 1,200,000,000 1,200,000,000 -

SAMPATH BANK 1250000000 1,250,000,000 1,250,000,000 -

CITY BANK 390,000,000 390,000,000 390,000,000 -

DFCC 100,000,000 100,000,000 100,000,000 -

2,940,000,000 2,940,000,000 2,940,000,000 -

Asset Backed and other Debt Securities of PLC as at 30th June 2015

FacilityCapital Outstanding

as at 30.06.2015 (Rs.)

Amount Repayable within 1 Year


Asset backed Securities 14,960,261,917 7,132,589,398 7,827,672,518

Promissory Notes 64,220,090 64,220,090 -

Commercial Papers 337,522,871 337,522,871 -

15,362,004,877 7,534,332,359 7,827,672,518


Public Deposits of PLC as at 30th June 2015

FacilityCapital

Outstanding as at 30.06.2015 (Rs.)

Amount Repayable within 1 Year


Fixed Deposits 26,573,496,811 21,719,994,010 4,853,502,802

Saving Deposits 4,669,770,909 4,669,770,909 -

Mudharabah Investments 1,671,413,003 1,671,413,003 -

32,914,680,723 28,061,177,921 4,853,502,802

Non Listed Debentures of PLC as at 30th June 2015

Lending Provider Facility Limit (Rs.)


(Rs.)


1 Year


1 Year

- - - -

- - - -


Listed Debentures of PLC as at 30th June 2015

Lending Provider Facility Limit


(Rs.)

Amount Repayable

within 1 Year


1 Year

Senior Unsecured Redeemable, AA (-) rated four years (2013/2017) and five years (2013/2018) debentures Rs 100/- each

Option-1 1,986,500,000 1,986,500,000 - 1,986,500,000

Option-2 1,583,500,000 1,583,500,000 - 1,583,500,000

Option-3 2,430,000,000 2,430,000,000 - 2,430,000,000

Sub Total 6,000,000,000 6,000,000,000 - 6,000,000,000

Senior Unsecured Redeemable, AA (-) rated three years (2014/2017) and four years (2014/2018) debentures Rs 100/- each

Type A 1,500,000,000 1,500,000,000 - 1,500,000,000

Type B 1,500,000,000 1,500,000,000 - 1,500,000,000

Sub Total 3,000,000,000 3,000,000,000 - 3,000,000,000

Total 9,000,000,000 9,000,000,000 - 9,000,000,000

Refinance Loans of PLC as at 30th June 2015

Lending Provider Facility Limit


(Rs.)


1 Year


1 Year

Refinance Loan

National Development Bank (Efreinds)

10,500,000 937,500 937,500 -

DFCC (Plantation) 105,530,747 4,668,750 4,668,750 -

CBSL (Construction, E- friends)

343,782,904 107,421,165 28,921,964 78,499,201

459,813,651 113,027,415 34,528,214 78,499,201

3.21 OTHER DEBT SECURITIES There are no outstanding Debt Securities convertible to equity as at 30th September

2015.


4 BOARD OF DIRECTORS

Name Position Residential Address

Mr. Hemasiri Fernando Non-Executive, Non-Independent Chairman

11A, Sri Saranankara Road, Pamankada, Dehiwala

Mr. Michael Pradeep Amirthanayagam

Non-Executive, Independent Deputy Chairman

107/38, Shalawa Road, Mirihana, Nugegoda

Mr. Jehan Prasanna Amaratunga

Non-Executive, Non-Independent Director

#5, Rajawatte Terrace, Colombo 5

Mr. Namasivayam Vasantha Kumar

Non-Executive, Non-Independent Director

189/8A, Sama Mawatha, Nawala, Rajagiriya

Mr. Johnson Anthony Fernando Non-Executive, Independent Director 24, Mayfield Road, Colombo 13

Mr. Mohamed Anise Mohamed Rizwan

Non-Executive, Independent Director

30, Pieris Place, Quarry Road, Dehiwala

Mr. Rathnayake Mudiyanselage Jayasena

Non-Executive, Independent Director Hureegama, Kobeigane

Dr. Ali Asgar Shabbir Gulamhusein

Non-Executive, Independent Director

No.264, Grandpass Road, Colombo 14

4.1 PROFILES OF THE BOARD OF DIRECTORS

Mr. Hemasiri Fernando Non-Executive, Non-Independent Chairman Possessing diverse experience in varied genres, Mr. Fernando’s debut into the

public sector was as Secretary to the Prime Minister. He later chaired Sri Lanka Telecom, Airport and Aviation Services and Telecom Services and has served as Secretary to the Ministry of Postal Services among other postings. His input as the longest serving President of the National Olympic Committee and in international office including as Vice President of the Olympic Council of Asia and Commonwealth Games Federation, in addition to representing Sri Lanka in rifle shooting as national champion, makes him the apt choice as Presidential Advisor on Sports to Sri Lanka.

With a B.A (Econ) from the University of Colombo, Associateship in the Institute of Travel and Tourism UK (A INST TT) and Fellowship of the British Institute of Management (FBIM), Mr. Fernando is also the present Chairman of People’s Bank and the Honorary Consul for the Kyrgyz Republic in Sri Lanka. His tenure in the Sri Lanka Navy from which he retired with the rank of Commander having served in combat areas, deserves special mention. His association with Sri Lanka Railways led to the penning of two books, The Viceroy Special based on the steam locomotive he created for tourism in Sri Lanka and The Uva Railway. Mr. Fernando has been conferred with the OCA Award of Merit by the Olympic Council of Asia and the ANOC Award of Merit by the Association of National Olympic Committees.


Mr. Michael Pradeep Amirthanayagam Non-Executive, Independent Deputy Chairman Mr. Pradeep Amirthanayagam is a reputed advertising and media personality in

Sri Lanka who counts over 30 years of experience in the advertising field. He is currently the Chairman and Managing Director of the leading advertising agency Holmes Pollard & Stott, which he was instrumental in setting up 25 years ago. He is the livewire that fuels the agency’s creative and client management teams, while providing crucial direction and guidance on operations and finance.

Mr. Amirthanayagam is also a media icon. He presented the news on TV and radio (Rupavahinie, ITN and SLBC), and was also an interviewer and cricket commentator. He has the distinction of having trained at Bush House - the headquarters of the BBC in London, and was the CNN correspondent for Sri Lanka.

Showing great promise from his early days, he was an outstanding product of St. Joseph’s College, Colombo. He won gold medals for oratory and singing, and also excelled academically, winning final year prizes for economics, commerce and finance, and accountancy. He was a member of the all-island under 12 champion cricket team in 1975, and went on to become head prefect of the college. He also played an active role in drama and debating, and was placed first in the entire country in an oratory contest themed ‘Rotary World Understanding and Peace’ organized by Rotary International.

Having achieved success since his early days, Mr. Amirthanayagam went on to distinguish himself further. He became a member of the Chartered Institute of Marketing and an Associate of Trinity College of London (Speech and Drama).

Respected for his philanthropic endeavors, Mr. Amirthanayagam has been active in the Rotary movement at the highest level. He is a Past President of the Rotary Club of Colombo West and was awarded the Rotarian of the Year in 2012. Over the years, he has made a notable contribution to the club, having been involved in almost every avenue of service.

Mr. Amirthanayagam is also the Vice President of SUROL (Society for the Uplift and Rehabilitation of Leprosy Affected Persons) and a Director of the Anura Bandaranaike Foundation.

Mr. Jehan Prasanna Amaratunga Non-Executive, Non-Independent Director Mr. Jehan Amaratunga is the Group Executive Deputy Chairman of MTD Walkers

PLC Sri Lanka, which is a leading infrastructure development company that is listed on the Main Board of the Colombo Stock Exchange and also serves as a Director of People’s Bank and JAT Holdings (Pvt) Ltd. He is a Member of the Institute of Chartered Accountants of Sri Lanka and is a Fellow Chartered Management Accountant. He was awarded First in Order of Merit Prize at the final level examination of the Institute of Chartered Accountants of Sri Lanka.

Mr. Amaratunga has over 30 years of extensive experience in finance and management and has been a Consultant and Director to a large number of Corporations and Private entities. Amongst his many achievements, he has presented a paper titled “Value for Money Accounting” at the National Conference of the Institute of Chartered Accountants of Sri Lanka in 1987. He was also a Member of the Governing Council of the Institute of Chartered Accountants of Sri Lanka.


Mr. Namasivayam Vasantha Kumar Non-Executive, Non-Independent Director Mr. Vasantha Kumar currently functions as the CEO/General Manager of People’s

Bank. Mr. Vasantha Kumar also serves on the Boards of Lanka Financial Services Bureau Ltd., Sri Lanka Bank’s Association (Guarantee) Ltd., Financial Ombudsman Sri Lanka Guarantee Ltd., Credit Information Bureau of Sri Lanka, Institute of Bankers of Sri Lanka, National Payment Council, People’s Insurance Limited, People’s Travels (Pvt) Limited, People’s Leasing Havelock Properties Limited and People’s Leasing Property Development Limited. Prior to joining People’s Bank, he served as the Treasurer at ANZ Grindlays Bank, Colombo.

Mr. Kumar holds a Master’s Degree in Business Administration and counts over 32 years of experience in Treasury Management. He was the past President of the Association of Primary Dealers and of the Sri Lanka Forex Association.

Mr. Johnson Anthony Fernando Non-Executive, Independent Director Being one of the founder-directors and co-owners of Expo Industrial Products (Pvt)

Ltd., established in 1992, Mr. Johnson Fernando is a veteran and widely travelled business professional counting over 25 years’ experience in senior management positions with the Expo Industrial Group which has diversified interests including in Apparel, Food Packaging, Industrial Printing, Commercial Printing, Logistics Management, Engineering and Construction.

He presently serves as the President of the Sri Lanka Association of Printers, the APEX body of printers in Sri Lanka, Vice President of the Sri Lanka China Business Council Cooperation and an advisory Board Member of the Benedict XVI Cultural Institute.

Mr. Mohamed Anise Mohamed Rizwan Non-Executive, Independent Director Mr. Rizwan Anise, Chief Operating Officer of DCS International (Pvt) Ltd., is an

accomplished senior marketing professional with over 18 years of experience in the field of Management and in particular Sales and Marketing in industries of IT, Pharmaceuticals, BPO, Apparel, Consumer Electronics, Shipping, Education and Mother & Baby Care. His experience and skills encompass management and operational insight, strategic planning, strategic marketing, brand development, portfolio management, public relations and sales management. During his career, Mr. Anise has held many senior management positions in public listed companies, as Vice President-Marketing Group Head of Marketing, Head of Marketing and Manager Business Development/Marketing & Corporate Communications in diverse industries.

Mr. Anise holds a Masters in Business Administration from the University of Wales, UK, Diploma in Business Management and is a Member of the Chartered Institute of Marketing, UK and a Certified Member of Sri Lanka Institute Marketing. He is also an adjunct lecturer and examiner for the Marketing and Management undergraduate programs offered by the Northwood University of USA, Heilbronn University of Germany and a Dissertation Supervisor for University of West London MBA program.


Mr. Rathnayake Mudiyanselage Jayasena Non-Executive, Independent Director Having commenced his career at the Land Reforms Commission in 1974,

Mr. Jayasena has also served the National Institute of Management, Ministry of Industries and Scientific Affairs as a consultant (1975 to 1977) and Isura Development Centre as an Executive Director (1988 to 2008). Mr. Jayasena is well known for his contributions to philanthropic endeavors and has played an active role in the National Forum of People’s Movement as the Vice Chairman from 1990 to 2009, Lanka Organic Agriculture Movement as a Director from 2000 to 2009, Green Movement, Sri Lanka as the Treasurer from 1999 to 2003 and Forest Garden Product Certification Limited as a Director from 2002 to 2005.

He is also widely traveled and has had the opportunity of participating in multifarious international study programs including, Project Management Study Program organized by I. D. R. C. Canada through the University of Manitoba (2002), Rural Development Study Programs in India and Bangladesh (1985), Micro Credit Management Program in Malaysia (1996), Self-Financing and Micro Credit Management Training in India (1999) and Small Enterprise Experience Exchange Program in India (2007).

Mr. Jayasena holds a Bachelor of Arts Degree from the University of Colombo and has extensive experience in project management and rural development.

Dr. Ali Asgar Shabbir Gulamhusein Non-Executive, Independent Director

Deshabandhu Dr. Ali Asger Shabbir Gulamhusein serves as Chairman and Director of several Private and Public quoted companies, including Adam Investments PLC, Orient Garments PLC, Ceylon and Foreign Trades PLC and Adam Capital PLC. He is also a Director of the Insurance Board of Sri Lanka and the Sri Lanka Institute of Textiles and Apparel.

Dr. Gulamhusein specializes in structured Acquisitions and Mergers with an emphasis on Manufacturing and Export entities. He accounts for over a decade of experience in diversified sectors such as Investments, Agriculture, Manufacturing, Apparel, Activated Carbons, Construction, International Trade, Information Technology and Automobile. He is also actively involved in several charitable projects throughout Sri Lanka having completed charitable projects in Buttala, Kapaladi and Colombo.

He holds a PhD from Tokyo, Japan and a Bachelor’s Degree in Computer Science and Business management from King’s College London, UK. Dr. Gulamhusein has been bestowed with the prestigious title of “Deshabandhu Manawahithawadhi, Lankaputhra” and also serves as a Justice of Peace (all island)

4.2 DIRECTOR’S STATEMENT No director or a person nominated to become a Director is/ was involved in the

following events • A petition under bankruptcy laws filed against such a person or any partnership in

which he was a partner or any corporation of which he was as an executive officer. • A conviction of fraud, misappropriation or breach of trust or any other similar offence

which the CSE considers a disqualification.


4.3 DIRECTORS INTEREST IN ASSETS Directors hold no interest in any assets acquired, disposed or leased by People’s

Leasing & Finance PLC during the past two years preceding the issue, and proposed to be acquired, disposed or leased during the two years succeeding the issue.

4.4 DIRECTORS INTEREST IN CONTRACTS OR ARRANGEMENTS There are no contracts or arrangements in force in which People’s Leasing &

Finance PLC is materially interested, in relation to the business of the Company as at the date of the Prospectus.

4.5 EMOLUMENTS OF THE BOARD OF DIRECTORS The Aggregate emoluments paid to the directors comprising and/or profit sharing

payment during the financial year ended 31st March 2015 was LKR 335,000/-. The estimated emoluments including bonus and/or profit sharing payment payable

for the financial year ending 31st March 2016 is 1,220,000/-.


5 CORPORATE MANAGEMENT AND SENIOR MANAGEMENT & THEIR PROFILES

5.1 CHIEF EXECUTIVE OFFICER/GENERAL MANAGER

Mr. D.P. Kumarage

Appointed to the Present Designation: 1997

Qualifications: PGDip in Modern Banking, Passed Finalist CIMA UK

Service & Experience: 36 years of experience in Banking and Finance. Prior to joining PLC he served People’s Bank and retired as a Deputy General Manager.

Other Appointments: He is the Managing Director of the other subsidiary companies of PLC and serves as a member of PLC’s Integrated Risk Management Committee.

External Appointments: He serves as the Vice President of the Asian Leasing & Finance Association; a Non- Executive Director of SANASA Development Bank PLC and Lanka Ashok Leyland PLC. He was also the former Chairman of the Leasing Association of Sri Lanka.

DECLARATION BY THE CHIEF EXECUTIVE OFFICER The Chief Executive Officer of the Company is not and was not:

(a) Involved in a petition under any bankruptcy laws filed against such person or any partnership in which he was a partner or any corporation of which he was an executive officer;

(b) Involved in a conviction for fraud, misappropriation or breach of trust or any other similar offence which the CSE consider as a disqualification; or

(c) The subject of any order, judgment or ruling of any court of competent jurisdiction temporarily enjoining him from acting as an investment advisor, dealer in securities, director or employee of a financial institute and engaging in any type of business practice or activity


5.2 PROFILES OF THE SENIOR MANAGEMENT

Mr. Sanjeewa Bandaranayake Deputy General Manager - Finance & Administration


Qualifications: FCA, CMA (Australia), FCMA (Sri Lanka), Finalist CIMA (UK)

Service & Experience: Over 20 years of post-qualifying experience at a very senior level in the finance sector. Possesses five years’ experience at Ernst & Young, Chartered Accountants.

Other Appointments: He serves as a member of PLC’s Integrated Risk Management Committee.

External Appointments: He is a Director of the Credit Information Bureau of Sri Lanka and Leasing Association of Sri Lanka. He also functions as Vice President of the Asian Financial Services Association (AFSA). He was a former Chairman of the Leasing Association of Sri Lanka and a former Committee Member of the Ceylon Chamber of Commerce and a former council member of the Sri Lanka Institute of Credit Management (SLICM).

Mr. Lionel Fernando Deputy General Manager - Operations Appointed to the Present Designation: 2013

Qualifications: ACA, AIB (Sri Lanka), PGDip in Business & Financial Administration (ICASL)

Service & Experience: Joined the Company in 1995 and held various senior positions at the Company. Has over 26 years’ experience in banking and finance sector.

Other appointments: He serves as a member of PLC’s Integrated Risk Management Committee.

Mr. Rohan Tennakoon Deputy General Manager – Business Development & Marketing


Qualifications: MBA (Colombo), MSc in Management (J’pura), BSc in Business Administration (2nd Class Upper) (J’pura), AIB (Sri Lanka) and Member (APBSL).

Service & Experience: Over 25 years of experience in many diversified fields such as Accounting, Manufacturing, Exporting and Banking and leasing. He has served almost 18 years in various capacities at PLC.

Other appointments: He is the Head of Islamic Division (Al- safa) of PLC and a member of PLC’s Integrated Risk Management Committee.

External Appointments: Represents the Company in the Council of Management of the Finance Houses Association of Sri Lanka, and serves as the Chairman of Sports Festival Committee. Also functions as the Company’s Compliance Officer for the Credit Information Bureau of Sri Lanka.


Mr. Damith Malavithanthila Assistant General Manager - Branch Operations


Qualifications: Finalist (ICASL), Intermediate (IBSL)

Service & Experience: Joined the Company in 1996 and had been the Head of Recoveries since the inception of the Company for 10 years. He has over 26 years of experience in banking & finance, and several years of experience in auditing and accounting. He is in- charge of the branch operation in the entire Southern Province and a part of Western province in Sri Lanka.

Other Appointments: He overlooks the operations of People’s Leasing Fleet Management Ltd., a fully owned subsidiary of PLC.

Mr. Laksanda Gunawardena Assistant General Manager - Branch Operations


Qualifications: MBA, MSc in Strategic Marketing, Diploma in Credit Management (SLICM) and an Associate Member of SLICM.

Service & Experience: Joined the Company in 2002 and had been the Head of Corporate Leasing for 09 years. He has over 20 years’ experience in the field of corporate and SME Financing, covering the areas of Credit, Marketing, Recoveries, Branch Development and Operations.

Other Appointments: He overlooks the operations of People’s Microfinance Ltd., a fully owned subsidiary of PLC.

Mr. Prabath Gunasena Assistant General Manager - ICT (Group)


Qualifications: MBA (Western Sydney), Diploma in Computer System Design (NIBM Sri Lanka), Member of the British Computer Society.

Service & Experience: Joined the Company in 1999 and has been the Head of ICT for the past 16 years.

Other Appointments: Head of ICT for the entire PLC Group.

Mr. Udesh Gunawardena Assistant General Manager - Internal Audit (Group)


Qualifications: ACA, ACMA (Sri Lanka), Associate of IPFM- UK, Member of IIA, Finalist CIMA (UK), Diploma in Treasury, Investments and Risk Management (IBSL), World prize winner of the Australian Computer Society.

Service & Experience: Joined the Company in 1999 as an Accountant and possesses over 20 years’ experience in the field of finance, covering accounting, auditing, financial management and treasury operations at senior level.

Other Appointments: Currently serves as the Secretary to Board Audit Committees of the Company and People’s Insurance Ltd. Head of Internal Audit for the entire PLC Group.


Mr. Ranil Perera Chief Manager - Branch Operations


Qualifications: Masters in Regional Development and Planning (Colombo), MBA (University of Manipal – India), PGDip in Economic Development (Colombo), B.Com (Special) in International Trade (J’pura), Part qualifications in CIM – UK & ICASL

Service & Experience: Has over 16 years of experience at People’s Leasing Group.

Mr. Uresh Jayasekara Chief Manager - Human Resources (Group)


Qualifications: B.Sc. Bio Science (Hon) (Kelaniya), Diploma in Management from the Open University, PGDip in Business Management (Colombo), MBA special in HR (Colombo), Sole Sri Lankan winner of the prestigious Japanese scholarship in year 2014, for the Leadership Development Programme under the HIDA- Osaka, Japan.

Service & Experience: Has over 16 years of experience in the field of Human Resources including Garments, Hospital, Insurance and Financial Sectors.

Other Appointments: Head of Human Resource for the entire PLC Group.

Mr. Saman Liyanage Chief Manager - Deposits & Savings


Qualifications: Diploma holder and Associate Member of SLICM, MBA (University of Sikkim Manipal- India)

Service & Experience: Joined the Company in 2004 and counts over 29 years of experience in the financial industry covering Branch Operations, Credit & Recoveries.

External Appointments: He is a member of Panel of Resource personnel of Centre for Banking Studies, Central Bank of Sri Lanka.

Mr. Andy Ratnayake Senior Manager - Risk Management & Control


Qualifications: Bachelor’s Degrees in Arts – Public Administration (J’pura), B.Com (Peradeniya), Member of IIA- United States, FCMA (UK), Chartered Global Management Accountant, Member of the Chartered Institute of Ship Brokers & Chartered Institute of Transport, PGDip in Shipping from the Norwegian Shipping Academy.

Service & Experience: Joined the Company in 1997 and had been the Head of Finance for 10 years. He has over 38 years’ experience in auditing, accounting, shipping and general management. He was the head of Internal Audit at Ceylon Shipping Corporation, General Manager at Central Freight Bureau and based in Riyadh Saudi Arabia as Audit Manager.

Other Appointments: He is functioning as the Secretary to the PLC’s Integrated Risk Management Committee.


Mr. Hasantha De Silva Senior Manager - Branch Operations


Qualifications: Higher National Diploma in Accountancy from the Technical College, Galle, Intermediate Level (ICASL)

Service & Experience: Joined PLC in year 2000, as a Branch Executive and later promoted as a Senior Manager and possesses over 15 years of experience. Has over 13 years of work experience in fields of operations & audit.

Mr. P. D. C. S. Mahanama Senior Manager - Branch Operations


Service & Experience: Joined PLC in 2003, as a Branch Manager and possesses over 12 years’ experience at PLC. Before joining PLC he has covered more than 20 years of experience in the marketing field within the Financial Sector.

Mr. Neil Thushantha Senior Manager - Branch Operations


Qualifications: B.Sc. (Agri) 2nd Class- Upper (Peradeniya), Part qualification- CIMA (UK)

Service & Experience: Joined PLC in year 2005 as a Branch Manager and later promoted as a Senior Manager. He served as an Assistant Vice President at Vanik Incorporation Ltd., and Capital Reach Leasing Ltd. Counts over 17 years of managerial experience in the financial field covering Leasing, Hire Purchase, Recoveries, Fund Mobilisation and Marketing.

Mr. Chamil Herath Senior Manager - Branch Operations


Qualifications: BSc. Business Administration (Special) Degree (J’pura), Licentiate Level (ICASL)

Service & Experience: Joined PLC in year 2005 as a Branch Manager and later promoted as a Senior Manager. Over 15 years’ experience in leasing industry with several Leasing Companies covering the areas of Credit, Marketing, Recoveries, Branch Development and Administration.

Ms. Kamani Dematawewa Senior Manager - Legal Recoveries


Qualifications: Attorney- at- Law and Notary Public, Diploma in Credit Management (SLICM) and won the President’s award for best results, Associate Member (SLICM), Post Attorney Diploma in Finance, Banking & Insurance Laws by the Institute of Advance Legal Studies of the Incorporated Council of Legal Education

Service & Experience: Over 28 years’ experience in the financial sector as a Senior Manager - Legal Recoveries and as a Company Secretary.

External Appointments: She was a former Chairperson of the legal circle of the Finance Houses Association of Sri Lanka.


Ms. Inoka Jayawardhana Senior Manager - Group Corporate Affairs & Investor Relations


Qualifications: Attorney- at- Law, Certified Compliance Officer, a Member of IABFM and holds a Diploma in International Relations from the Bandaranaike Centre for International Studies, Sri Lanka.

Service & Experience: Has over 14 years’ experience in corporate and commercial law. She was a Senior Legal Counsel (January 2009- July 2010) and an Associate (January 2001- December 2008) at M/s. F. J. & G. de Saram, Attorneys- at- Law & Notaries Public. She was a Director of Corporate Services (Private) Limited, an associate of M/s. F. J. & G. de Saram providing corporate secretarial services to the clients of the said firm.

Other Appointments: Compliance Officer of the Company.

Mr. Omal Sumanasiri Senior Manager – Finance


Qualifications: B.B. Mgt (Accountancy) -1st Class (Kelaniya), ACA, ACMA (Sri Lanka)

Service & Experience: Has over 11 years of experience in the fields of Accounting and Auditing. Joined the PLC Group in September 2010 as the Deputy Manger - Finance and later promoted as the Senior Manager – Finance in PLC.

Mr. P. N. Nishantha Perera Senior Manager - Margin Trading/Portfolio Management


Service & Experience: Counts over 24 years in Investor Services and Margin Trading operations of which over 24 years have been in John Keells Holdings PLC & Nations Trust Bank PLC. He joined John Keells Holdings PLC in 1991 and joined Nations Trust Bank in 2002.

Mr. A. J. A. Mohideen Maharoof Senior Manager - Islamic Finance


Qualifications: Completed the intermediate Examination (IBSL)

Service & Experience: Counts over 30 years of experience in many diversified fields such as Banking & Finance (over 24 years), Garments and Automobile Industries. He has 7 years’ experience at Commercial Bank, 13 years’ experience at LB Finance Ltd and quit his position as Deputy General Manager (Credit & Recoveries). Thereafter he switched his career to Garment Manufacturing. In late 2006 he took up an overseas assignment in Malawi in Africa to work as the General Manager for an automobile company. He also served at Amana Bank PLC and Seylan Bank PLC.


5.3 EMOLUMENTS OF THE SENIOR MANAGEMENT

The Aggregate emoluments paid to the Senior Management comprising and/or profit sharing payment during the financial year ended 31st March 2015 was LKR 203,257,710.90.

The estimated emoluments including bonus and/or profit sharing payment payable for the financial year ending 31st March 2016 is LKR 223,583,548.99.


6 STATUTORY DECLARATIONS

6.1 STATUTORY DECLARATION BY THE DIRECTORS

We, the undersigned who are named herein as Directors of People’s Leasing & Finance PLC hereby declare and confirm that we have read the provisions of CSE Listing Rules and of the Companies Act No. 7 of 2007 and any amendments thereto relating to the issue of the prospectus and those provisions have been complied with.

“This Prospectus has been seen and approved by the directors of the People’s Leasing & Finance PLC and they collectively and individually accept full responsibility for the accuracy of the information given and confirm that provisions of the CSE Listing Rules and of the Companies Act No. 07 of 2007 and any amendments to it from time to time have been complied with and after making all reasonable enquiries and to the best of their knowledge and belief, there are no other facts the omission of which would make any statement herein misleading or inaccurate. Where representations regarding the future performance of the People’s Leasing & Finance PLC have been given in the Prospectus, such representations have been made after due and careful enquiry of the information available to the People’s Leasing & Finance PLC and making assumptions that are considered to be reasonable at the present point in time in the best judgment of the directors.

An application has been made to the Colombo Stock Exchange for permission to deal in and for a listing of all securities in a particular class issued by the People’s Leasing & Finance PLC and those Securities of the same class which are the subject of this issue. Such permission will be granted when the Securities are listed on the Colombo Stock Exchange. The Colombo Stock Exchange assumes no responsibility for the correctness of any of the statements made or opinions expressed or reports included in this Prospectus. Listing on the Colombo Stock Exchange is not to be taken as an indication of the merits of the People’s Leasing & Finance PLC or of the Debenture issued”

The parties to the issue (i.e. Lawyers, Auditors, Secretaries, Managers and Rating Company) have complied with all applicable regulatory requirements to such parties, and that such parties have no conflict of interest with the Company. Further, the said parties have submitted to the Company declarations declaring the same.

Sgd Hemasiri Fernando Chairman

Sgd Michael Pradeep Amirthanayagam Deputy Chairman

Sgd Jehan Prasanna Amaratunga Director

Sgd Namasivayam Vasantha Kumar Director

Sgd Johnson Anthony Fernando Director

Sgd Mohamed Anise Mohamed Rizwan Director

Sgd Rathnayake Mudiyanselage Jayasena Director

Sgd Ali Asgar Shabbir Gulam Husein Director


6.2 STATUTORY DECLARATION BY THE JOINT MANAGERS TO THE ISSUE

We, People’s Bank - Investment Banking unit of People’s Bank Head Office,13th Floor, No 75, Sir Chittampalam A Gardiner Mawatha, Colombo 02 being the Joint Managers to the Debenture issue of People’s Leasing & Finance PLC, hereby declare and confirm that to the best of our knowledge and belief based on the information provided to us by the Company, the Prospectus constitutes full and true disclosure of all material facts about the Issue and People’s Leasing & Finance PLC.

The Common Seal of People’s Bank was affixed on the 20th July 2015 at Colombo in the presence of two Directors and Secretary to the Board of Directors of People’s Bank.

Sgd. Secretary to the Board of Directors

Sgd Sgd Director Director

6.3 STATUTORY DECLARATION BY THE JOINT MANAGERS TO THE ISSUE

We, NDB Investment Bank Limited, of No 40, Nawam Mawatha, Colombo 02 being Joint Managers to the Debenture issue of People’s Leasing & Finance PLC, hereby declare and confirm that to the best of our knowledge and belief based on the information provided to us by the Company, the Prospectus constitutes full and true disclosure of all material facts about the Issue and People’s Leasing & Finance PLC.

The Common Seal of NDB Invesment Bank Limited was affixed on the 22nd October

2015 at Colombo in the presence of two Directors of NDB Invesment Bank Limited.

Sgd. Sgd. Director Director


7 FINANCIAL INFORMATION

7.1 Financial Information

The following financial information of People’s Leasing & Finance PLC is available on the website of CSE (www.CSE.lk) and the website of the Company (www.plc.lk).

- Audited financial statements of the Company for the year ended 31st March 2015. - Quarterly Financial Statements as of 30th June 2015. - Summarized financial statements for the five year preceding the date of the

application (i.e for the financial years ending 31st March, 2011, 2012, 2013, 2014 and 2015) the Accountant’s Report stating the accounting policies adopted by the Entity certified by the auditors.


ANNEXURE I - RATING REPORT




ANNEXURE II - COLLECTION POINTS


COPIES OF THE PROSPECTUS CAN BE OBTAINED FREE OF CHARGE FROM THE FOLLOWING COLLECTION POINTS

Joint Managers to the Issue

People’s Bank Investment Banking Unit NDB Investment Bank Limited,People’s Bank Head office, No 40, Nawam Mawatha,13th floor, Colombo 02.No.75, Sir Chittampalam A Gardiner Mawatha Tel: +94 11 2300385-90Colombo 02. Fax: +94 11 2300393Tel : 94 11 2 206795-6 Fax: 94 11 2 458842

Banker to the Issue Registrars to the Issue

People’s Bank - Lucky Plaza SSP Corporate Services (Pvt) Ltd 70, St. Anthony’s Mawatha, No 101, Inner Flower Road Colombo 03 Colombo 03 Tel : 94 11 5 634115, 011 2 576531 Tel : 94 11 2573894 Fax : 94 11 2 576530 Fax : 94 11 2573609

Company Registered Office

People’s Leasing & Finance PLC Head OfficeNo 1161, Maradana Road,BorellaTel : 011 2 631631

Trading Members Debt and Equity

Acuity Stockbrokers (Private) LimitedLevel 6, Acuity House,No. 53, DharmapalaMawatha,Colombo 03T: 011 2 206206

Asha Phillips Securities Limited2nd Floor, lakshmans Building,No 321, Galle Road, Colombo 03T: 011 2 429100

Asia Securities (Private) Limited2nd Floor,No 176/1-2/1, Thimbirigasyaya Road,Colombo 05.Tel. 011 7 722000

Assetline Securities (Pvt) Ltd.No. 120,120A ,Pannipitiya RoadBattaramullaT: 011 4 700111

Bartleet Religare Securities (Private) LimitedLevel G, “Bartleet House”No. 65, Braybrooke Place,Colombo 02T: 011 5 220200

Capital Trust Securities (Private) LimitedNo. 42, Mohamed Macan Markar Mawatha,Colombo 03T: 011 2 174174

CT CLSA Securities (Private) Limited4-14, Majestic City,No. 10, Station Road,Colombo 04T: 011 2 552290-4

Capital Alliance Securities (private) LimitedLevel 5, “Millenium House”,No. 46/58, NavamMawatha,Colombo 02T: 011 2 317777


Claridge Stockbrokers (Pvt) LtdNo. 10, Gnanaratha Pradeepa MawathaColombo 08 T: 011 2 697974NDB Securities (Private) Limited.5th Floor, NDB Building,No. 40, Navam Mawatha,Colombo 02.

First Guardian Equities (Private) Limited32nd Floor, East Tower, World Trade Centre,Echelon Square,Colombo 01T: 011 5 884400

Candor Equities Limited.Level 8, South Wing, Millennium HouseNo. 46/58, Nawam Mawatha,Colombo 02T: 011 2 359100

Enterprise Ceylon Capital (Private) Limited.27th Floor, East Tower, World Trade CenterEchelon Tower, Colombo 01T: 011 2 333000

J B Securities (Pvt) Ltd.No. 150, St. Joseph StreetColombo 14T: 011 2 490900, 077-2490900

John Keells Stockbrokers (Private) LimitedNo. 186, Vauxhall Street,Colombo 02T: 011 2 306250, 2 342066-7

Lanka Securities (Private) LimitedNo. 228/1, Galle Road,Colombo 04T: 011 4 706757, 011 2 554942

LOLC Securities LtdLevel 18, West Tower, World Trade CenterEchelon Square,Colombo 01T: 011 7 880880

Nation Lanka Equities (Private) LimitedNo. 44, Guildford CrescentColombo 07T: 011 4 889061-3

Somerville Stockbrokers (Private) LimitedNo 137, Vauxhall Street,Colombo 02.T: 011 2 329201-5

S C Securities (Private) Limited2nd Floor , 55 D.R. Wijewardena Mawatha,Colombo 10T: 011 4 711000

First Capital Equities (Private) LimitedNo.01, Level 02, Lake Crescent,Colombo 02.T: 011 2 145000

Richard Pieris Securities (Private) LimitedNo. 55/20, Vauxhall Lane,Colombo 02T: 011 7 448900

Navara Securities (Private) LimitedNo 25-2/1, Milepost Avenue,Colombo 03.T: 011 2 358700/20

SMB Securities (Private) LimitedNo.102/1, Dr N.M.Perera Mw,(formally Cotta Road),Colombo 08 T: 011 4 388138

Taprobane Securities (Private) Limited2nd Floor, No 10, Gothami Road,Colombo 08T: 011 5 328200

TKS Securities (Private) Limited4th floorNo 245, Dharmapala Mawatha,Colombo 07.T: 011 7 857799

Softlogic Stockbrokers (Private) LimitedNo.06, 37th Lane, Queens Road,Colombo 03.T: 011 7 277000

Capital Alliance LimitedLevel 5, “Millenium House”,46/58, Nawam Mawatha, Colombo 02T: 011 2 317777

First Capital Markets LimitedNo. 02, Deal Place,Colombo 03.T: 011 2 639 898

Entrust Capital Markets (Pvt) LimitedLevel 15, East Tower,World Trade Center,Echelon Square,Colombo 01.Tel: 011 5 500600

Perpetual Treasuries LimitedLevel 3,Prince Alfred Tower,No10, Alfred House Gardens,Colombo 03.Tel 011 2 206123


Acuity Securiteis Limited,4th Floor,No 53, Dharmapala Mawatha,Colobmo 03.Tel: 2 206280

NSB Fund Management Company LimitedNo 255,1st Floor, NSB Head Office,Galle Road,Colombo 03.Tel: 2 565956

Natwealth Securities LimitedPrince Alfred House Gardens,Colombo 03.Tel: 4 716274

Wealthtrust Securities Limited No.32, Castle Street,Colombo 08.Tel: 011 2 689823

Custodian Banks

Bank of CeylonHead Office,11th Floor,04, Bank of Ceylon Mawatha,Colombo 01Tel: 011 2317777, 011 2448348

Citi Bank65 C, DharmapalaMawatha,P.O. Box 888,Colombo 07Tel: 011 244 7316/8, 011 244 7318,011 244 9061, 011 232 8526, 011 479 4700

Commercial Bank of Ceylon LimitedCommercial House,21, Bristol Street,P.O. Box 853,Colombo 01Tel: 011 244 5010-15, 011 238 193-5

Deutsche BankP.O. Box 314No. 86, Galle Road,Colombo 03Tel: 011 244 7062, 011 243 8057

Hatton National Bank PLCHNB Towers,479, T.B. JayahMawatha,Colombo 10Tel: 011 266 4664

Nations Trust Bank Ltd242, Union Place,Colombo 02Tel: 0114 313131

National Savings BankSavings House255, Galle Road, Colombo 03Tel: 5 730081-5

People’s BankHead Office, 5th Floor,Sir Chittampalam A Gardiner MawathaColombo 02Tel: 011 278 1481,011 2446316

Pan Asia Bank450, Galle RoadColombo 03Tel: 011 2 565565

Sampath Bank Limited110, Sir James Peiris Mawatha,Colombo 02Tel: 011 533 1458

Seylan Bank LimitedLevel 8, CeylincoSeylan Towers,90, Galle Road,Colombo 03Tel: 011 245 6789, 011 470 1812

Standard Chartered Bank37, York Street,P. O. Box 112,Colombo 01Tel: 011 479 4400, 011 248 0000

State Bank of India16, Sir Baron JayathilakeMawatha,Colombo 01Tel: 011 232 6133-5, 011 243 9405-6

Union BankNo 15A, Alfred Place,Colombo 03Tel: 011 2 370 870

The Hong Kong and Shanghai Banking Corporation Limited24, Sir Baron JayathilakeMawatha,Colombo 01Tel: 011 232 5435, 011 244 6591

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