17 January, 2022


Arjuna Mahendran Continues To Abuse Power By Protecting Lankaputhra Bank Chairman – ACF

The Anti-Corruption Front (ACF) today accused Central Bank Governor Arjuna Mahendran of abusing his power at the bank protecting Chairman of the Lankaputhra Development Bank Limited (LDBL), Lasantha Gunawardena, despite an order issued by the Central Bank’s Department of Bank Supervision calling for his ouster.



“The Governor who through two bonds issues has been involved in a conflict of interest is at present misusing and abusing the powers afforded to his position, by using his powers to keep Gunawardena as the Chairman of the bank,” the Anti-Corruption Front said in a statement.

The Department of Bank Supervision on the 24th of March 2016 in a letter to the Chairman of the LDBL ordered that he should no longer continue to serve in the said post. “The reason for this was twofold. The first was that Gunawardena did not possess the professional qualifications required as per Section 3 (5) (IX) of the Banking Act, Direction No. 12, of 2007. The second was that previously despite warnings of danger being given, the Chairman had unheeded them and failed to protect the Bank’s confidentiality and thereby failed to fulfill the duties and responsibilities of the post of the Chairman,” ACF said.

Financial institutions and special banks registered in the country are bound to conduct themselves in accordance with directives and warnings provided by the CBSL’s Department of Bank Supervision. This is for the betterment of the banking process and to protect the standards in place. Section 76 (h) (42) (2) of the Banking Act, No. 30 of 1988, provides the CBSL with the required powers for this.

“The Central Bank Governor cannot rescind the said power. The orders based on the recommendations of the Department of Bank Supervision after vigilant monitoring and analysis, are applicable equally to the entire banking sector. Aside to this, against the Chairman of the LDBL who is forcibly occupying the said post, information with evidence has come to light that he is influencing and interfering with the daily affairs of the Bank, directly intervening with regards to recruitments, and that he revealed information pertaining to clients and stakeholders of the Bank at a press conference,” the statement said.

However, Mahendran had recalled the letter sent on 24th of March. “The CBSL Governor has no power to recall a letter sent by the Department of Bank Supervision. Recalling recommendations made following a technical assessment constitutes a dictatorial/ an authoritarian/ an arbitrary act. An inquiry into this matter has revealed that the Department of Bank Supervision has never recalled an original, initial letter sent by them. Therefore, this letter still remains valid. If so, how is the Chairman of the LDBL still continuing on in the post?,” ACF questioned.

According to the Front, Mahendran too was carrying out the affairs of his office in the same arbitrary manner as the previous Governor, Ajith Nivard Cabraal. “Instead of Cabraal’s gang which destroyed the financial reserves of the country by investing in Greek bonds, the father-in-law and son-in-law team continue to maintain their conflict of interest. Throughout this, the process of issuing bonds continues on sans transparency. The perfect evidence to prove that the CBSL Governor has abused and misused powers afforded to him is the fact that he intervened with regards to the removal of the Chairman of the LDBL. The ACF strongly emphasizes that such a Governor should not be reappointed to the post of the CBSL Governor,” the statement said.

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Latest comments

  • 9

    Hello – Listen to the citizens and terminate his services forthwith. This is not Yahapalanaya.!! It seems that somebody is benefiting from his unauthorized works. bye- Nihal Gunatilake

    • 6

      President Maitripala Sirisena and Prime Miniser Ranil Wickramasinghe,

      “The Anti-Corruption Front (ACF) today accused Central Bank Governor Arjuna Mahendran of abusing his power at the bank protecting Chairman of the Lankaputhra Development Bank Limited (LDBL), Lasantha Gunawardena, despite an order issued by the Central Bank’s Department of Bank Supervision calling for his ouster.”

      Can You Please replace, Mahendran and give him a fishing boat to fish in the vast Indian Ocean. We can export the fish to EU and earn valuable foreign exchange. We can save on his credit cards too!

      What is the Problem? Your Guts? Your IQ? Just Curious!

      • 14

        Mr Wickramasinghe its time you listen to the public voice, you may be a big bully in your party, and arrogant with the press.. remember what happened to MR . you are no march

      • 14

        What is the Problem? Your Guts? Your IQ? Just Curious! “

        Are you the gate keeper to the mortuary??

        • 4


          “Are you the gate keeper to the mortuary??”

          Interesting Comment.

          Some of these guys belong in the mortuary. What is lacking is the will to send them there.

          The White Van bosses had no hesitation.

          • 9

            why don’t you join CT’s exclusive old crocks dog van unit.
            they are trying for a prize at the next galle festival by night.
            Whooooo… poya!!

      • 13

        This person with his pseudonym ‘Amarasiri’ is now changing his tune. He was until last month praising Yahapalanaya and its corrupt ministers and Cia agents and NGOs. loks CIA has stopped paying him hi $10/ payment for each of vitriolic comments on your pages.

        • 2

          Don Juan Dharmapala,

          Did the Portuguese treat you well?

          “This person with his pseudonym ‘Amarasiri’ is now changing his tune. He was until last month praising Yahapalanaya”

          This person Amarasiri tells crooks, they are crooks.

          This person Amarasiri tells Idiots, they are Idiots.

          This person Amarasiri tells Good Governance, they are they are all right.

          This person Amarasiri tells with Good Governance turns into Bad Governance crooks, they are crooks.

          This person Amarasiri tells a Spades, they are Spades.

          This person Amarasiri tells …..

          This person Amarasiri tells crooks ……

          • 11

            monster of the mortuary.
            no wonder school drop out Churchill never got elected.
            you have no marbles.

          • 5

            This man Amarasiri has no grasp of English. ‘a spades is a spades’ This man Amarasiri is a paid agent of CIA.This man Amarasdiri hates Sinhalese. This man Amarasiri needs tuition in a night school to learn English.

  • 10

    Please get rid of him! We do not need anymore rogues!

  • 5

    Lets see if the country’s future is worth than the PM-Arjuna friendship.

  • 8

    The Govt., specially PM Ranil who recruited Mr. Mahendran should come forward and either clear his name and prove his ability or sack him.He
    has become an embarrassment to the Tamils though he is not a product
    of Jaffna as Tamils have proved their worth in govt. or commercial sectors. In such a short time of 18 months, volumes of his so called
    misdeeds were written in the media and spoken in Parliament. If PM is not going to defend him in Parliament and media and get him exonerated
    of all accusations and only get him to use his banking experience and work miracles for CB, Mr.Mahendran should resign,saving his reputation,
    putting aside his college and family relationship with the PM. He will be doing a great favour to the Tamil community.

    • 4

      Ranil why are you so stupid and arrogant, you think you are too smart because you have made some people think that you are a clean good administrator, you stupid fellow

    • 3

      I agree with you LW.Mr.Mahendran good as a Investment Banker I think he is more suited to serve Morgan Stanley,UBS or HSBC.Not as Governer of Central Bank of Sri Lanka.Governor role in Central Bank has to play entirely different of role.Basically he is the gatekeeper to Country’s Treasury he should pay more attention get the country maximum revenue while minimizing the expenditure.As a citizen I don’t think he is doing good role.If one looks at country’s exports last few years can it is coming downward trend while imports getting higher letting country Balance of payment crises.Situation had worsened as there is no short,mid,long term plan to improve the exports not even non traditional sectors while pruning down on importing non essential items.Pathetic thing is small entrepreneur who manufactures locally have to compete with foreign superior products.Writer as close advisor US President advise him to popularize “Made In USA” during his 2nd term election campaign which became fairly success in US Auto industry.

      • 3

        ” Balance of payment crises.”
        Sri Lanka Balance of Trade 2003-2016 | Data | Chart | Calendar | Forecast
        Sri Lanka’s trade deficit narrowed 11.9 percent year-on-year to $551.70 USD in February of 2016, reaching the lowest level since March last year. Exports decreased 1.7 percent, hit by lower commodity prices. Shipments of petroleum products were down 55.6 percent, followed by 33.2 percent drop in gems, diamonds and jewellery exports and 10.7 percent decline in rubber products while textiles and garments rose 10.3 percent. Imports tumbled for the 8th consecutive month by 5.9 percent, dragged down by fuel (-43.7 percent), building materials (-10.4 percent), transport equipment (-24.9 percent) and food (-16 percent) purchases. Balance of Trade in Sri Lanka averaged -458.68 USD Million from 2003 until 2016, reaching an all time high of -50.10 USD Million in May of 2003 and a record low of -1100.70 USD Million in November of 2011. Balance of Trade in Sri Lanka is reported by the Central Bank of Sri Lanka.

        “2nd term election campaign which became fairly success in US Auto industry. “
        Cut the crap about auto the gas at the pump is almost same even at china, usa though the price of crude went down from 155 to 30.

        GDP forecast SL to pick up to 5.3% from 4.6%
        GDP forecast China’s 2016 growth forecast at 6.7%

        That left Beijing with a trade surplus of $49.98 billion, wider than April’s $45.56 billion reading but missing Reuters’ $58 billion forecast.
        For the first five months of the year, annual exports were 7.3 percent lower while imports were down 10.3 percent.
        “China has been losing worldwide market share on manufactured products for a while… if worldwide trade in dollar terms is zero, China is at minus 4. This is no surprise because most competitors have had their currency depreciating by 20-25 percent since 2013, but the yuan has remained broadly stable, with depreciation only beginning since July 2015.”

  • 9

    We had an uneducated crook before & now an educated crook. Isn’t there anybody who is not a crook in Sri Lanka to take this job?

    The Governor of the Bank of England is a Canadian who was appointed after an international head hunt. He earns around £800k PA inclusive of perks which is available for public scrutiny & obviously his high salary is in reflection of his competence in running such an important national institution. Tt’s time the SL Central Bank Governor’s salary & perks are also revealed to see how it compares with that of a similar officer in the 5th largest economy in the world.

  • 5

    Sri Lanka is NOT a democracy except on paper and anyone who thinks she is, is an idiot. Just because we vote, it is not democracy. Democracy is the ability to vote into office people who WE THINK will do a proper job. More importantly, to have a choice of such people and not gangster, kudu karayas and political whores.

    The fact that the MS/RW combine have appointed into Parliament a group of losers, who were NOT deemed suitable for office by the people of Sri Lanka, is the best proof I can offer. And, there was not a hum from the people or the media about the obvious violation of democratic principles. The key here is that no laws were broken. To hell with the public trust and principles. Those are for election speeches only.

    Mahendran may have aided his son-in-law, maybe he did not. His son-in-law was in the bond racket during the Rajapakse time too. He was not doing anything different. Why is the JO not asking questions from Bank of Ceylon officials who lent him the money to purchase these bonds? What did he put up as surety? If it was such a guaranteed bet, why were more bidders involved?
    These are the questions the pontificating Ranil Wickremesinghe should answer in Parliament.

    When the PM of the nation thinks most of us are gus-gembas and only he and his Royalist batch mates wipe their arses with paper… we have a problem. He is well aware that the political scenario is in his favor and the SLFPers and the rest are like fish stuck in shallow waters. Like his uncle JR, he keeps fanning the flames and setting bonfires in opposition camps and is whistling dixie, well aware there will be no accountability for a few years. With the local government elections also postponed on the false premise that it favors the UNP, the idiots in the SLFP are between the devil and the wide open seas.

    • 8

      “”””Why is the JO not asking questions from Bank of Ceylon officials who lent him the money to purchase these bonds? “”

      Its how Robert Vadra the Gunda- He is the son-in-law of Rajiv Gandhi and Sonia Gandhi.played with banks and land.

      That is also a line of practice at BoC.- its pointless to say even pointless.

      its the system that lent it to him.
      you can only replace the operating system only at next election- how you fare is the joke on you and all the stupids who vote.

      luck machan luck.

  • 1

    “The first was that Gunawardena did not possess the professional qualifications required as per Section 3 (5) (IX) of the Banking Act, Direction No. 12, of 2007”

    Section 3 (5) (IX) of the Banking Act No.12, of 2007- This is what it says…

    “The chairman, shall not engage in activities involving direct supervision of key management personnel or any other executive duties whatsoever”

    Definitely not about the PROFESSIONAL QUALIFICATIONS of the Chairman!!!

  • 2

    There was a interesting article on LBO… this is what Lasantha Gunawardena told at a news conference…

    “May 11, 2015 (LBO) – Sri Lanka’s state owned Lankaputhra bank is going through a hard time due to non-performing loans given on the instruction of the Rajapakse regime, the Bank’s Chief told reporters at a press briefing held Colombo.

    Lankaputhra started operations in 2006 with an aim to finance and uplift small and medium enterprises.

    “After we undertook the management, we saw that a huge amount of loans has been given to a selected people without proper collateral,” new chairman of the Lankaputhra Development Bank, Lasantha Gunawardena said at a media conference held at Colombo.

    “Some of those loans have been converted to bad debt,”

    “Up to now, about 1,600 million rupees are there to be collected which were given under the instructions of the former government,”

    “When we started the process of collecting these monies, we have come to understand that the money has been given without proper collateral.”

    Gunawardena said about five million rupees has been given under a direction issued by the officials in the last regimes treasury, for some semi precious stones which were estimated at 1.4 million rupees by the Gems and Jewelry Authority.

    Full story at http://www.lankabusinessonline.com/sri-lankas-state-owned-lankaputhra-bank-in-trouble-due-to-unpaid-loans/

    So what could be the motive to remove Lasantha Gunawardena from the post of chairman? Is Banking Supervision part of this and assisting some crooks?

  • 3

    Singapore Mahendran is draining our Yahapalana suckers to the max.

    look at the number of F**K Off notices already from some of the hard core suckers, bar Native Vedda.

    Yahapalana Fan Clubs must have a lot of irate members, for this ACF to even name the Son in Law as part of the Bond Hoist gang…

    BTW , Sumane thought Son in Law and Father in Law fixed only the inaugural Yahapaana Bond Issue to collect that 2.65 % on LKR 6 Billion over 30 years.

    Out which a small cut going to Malik, to help Batalanada’s future Election Fighting Funds.

    Apparently they have done two..

    Thanks ACF..

  • 1

    Talking about abusing power, here is one more for the Yahapalana suckers to ponder, while having their Lattes or Red Label

    IMF says, the Central Bank asked them not publish their Program Report on conditions for granting the USD 1.5 Billion loan.

    Wonder why?….

  • 2

    This Arjuna bloke is proving to be the albatross around the PM’s neck. He can’t be removed without the credibility of Ranil taking a battering. After all Arjuna, Ranil’s chosen majic man, like his namesake in the Ramayana was supposed to lift Sri Lanka from its economic morass, a calamitous morass left over by MR and his coterie of rogues. But so far Arjuna has only succeeded in getting into one controversy or another and bungling his way around.

    If you ask me, he should be removed. But then who will replace him. A great many rogues and fraudsters in well pressed suits are waiting in the wings to take his place.

  • 2

    In today’s tempestuous financial situation anyone sitting in the chair of the CBSL will be under regular fire. That is the nature of the job in developing countries. Look at the predicament of that eminently qualified top WB Economist Dr. Raghuram Rajan, the current head of the
    RBI. Despite bolstering the troubled massive Indian economy, he is under attack by that degenerate crook Subramaniam Swamy. From the day Dr. Rajan was appointed Swamy has attacked him and called for his removal. As India knows, that is the nature of Swamy – an unprincipled politician with no political electorate. The Indian PM has, at last, given to his 24×7 plea to be made a Rajya Sabha MP.

    Compared to that Junior Accountant and wheeler-dealer “yes” man Cabraal, Arjuna Mahendran is an internationally recognised Economist. He is in demand by leading banks in Singapore as Analyst and global financial expert. He is an asset to the country and is respected in the global financial world – including WB/IMF.

    Whether he made mistakes in the matter of his son-in-law in bidding for placements with the CBSL, I don’t know. However, I must say the man needs a little more diplomacy in dealing with the media and his detractors – an area in which he can learn from the calm and collected Dr. Raghuram Rajan.


  • 0


    Who is protecting the MR clans?

    The news
    The Anti-Corruption Front (ACF) today accused Central Bank Governor Arjuna Mahendran of abusing his power at the bank protecting Chairman of the Lankaputhra Development Bank Limited (LDBL), Lasantha Gunawardena

  • 0

    [Edited out]

  • 2

    The replacement should be Sanjin Vass Gunawardana he got very good experience in global finance.

  • 0

    All sorts of corruption must be address by authorities ,no one above the law in case of corruption charges that including CB governor.
    The corruptions is killer of “democracy”,”good governance” and “rule of law”.

  • 1

    Do a little research without mouthing off.

    lasantha helped Ranil for a few years before the elections in organizing Green Blood and working hard for him. Payback was the job. I have no idea what he has done on the job. Perhaps he is incompetent.

    Anyway, Mahendran does not know this man from Adam, he was just instructed to pull the letter out from the PMs office that is all. So much for independence! But then if the past is anything to go by, he did not bankrupt Lankaputhra like the previous regime on the Leader’s instructions on whom to to lend to.

    Things have not changed, just the magnitude of the robbery has declined by a factor of ten.

  • 5

    Fed up with CT s bullshit stories on AM.
    He is a professional unlike most f the other appointees in the govt sector today.
    A gentleman like no other.
    Cut the crap & stop publishing garbage .
    The news you ll print only needs to go into a shredder.
    Well aware of who is in ur payroll to print this garbage.
    You ll discover it in this life time.
    It ll befall many generations.
    The money won’t take you far.

    • 5

      “impartiality -I believe that in most cases it gets you closer to the truth, because it imposes a discipline of testing all assumptions, very much including your own.
      That discipline does not come naturally. I believe journalism that starts from a publicly declared predisposition is less likely to get to the truth, and less likely to be convincing to those who are not already convinced.”

      So quite a number of CT journalist aren’t ProPublica and says by condition
      “we are not neutral.”

      never mind . how soon any ones guess.

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