A request had been made by the Minister of Cooperatives and Internal Trade, Johnston Fernando, to write off non-performing loans amounting to Rs 1.9 billion, which cooperatives owed state banks and other institutions.

The Minister had submitted a cabinet paper to this effect had informed cabinet that it had become impossible for these cooperatives to function because of the heavy debt they were carrying. It was revealed that the total amount owed by cooperatives to the People’s Bank alone was a staggering Rs 1.17 billion while Rs 668.65 was owed to several rural banks as well.

Minister Fernando said that he had submitted a document which contains the names of those who had been responsible for this dilemma to the cabinet. The reasons for these the cooperatives getting into debt had also been listed out in the document, ministry sources said. According to the report these losses were incurred as a result of implementing decisions taken by the cost of living committee, the non-functioning ofcooperatives in the North and the East during the war and 2004 tsunami.

Source: Daily Mirror - Sri Lanka