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Ishara shuns ‘richest man’ tag; says ‘accolade, but not goal’

  • LOLC tipped to make hefty capital gains by selling 70% stake in Cambodia’s largest microfinance venture for Rs. 110 b; initial LOLC investment less than Rs. 50 b
  • Says transaction surpasses all other in Sri Lankan corporate history, of mega significance regionally

By Nisthar Cassim

With business circles abuzz with news of the biggest corporate Sri Lankan deal worth Rs. 110 billion, it is being said that LOLC Group Deputy Chairman Ishara Nanayakkara is the richest man in Sri Lanka, a tag he told the Daily FT prefers to shun.

On Monday, LOLC formally announced it was selling the 70% stake in Cambodia’s largest microfinance company, PRASAC, to Korea’s biggest commercial bank, Kookmin, for a staggering $ 603 million, or Rs. 110 billion. PRASAC is valued at $ 862 million, and the sales proceeds will be received in two tranches: $ 422 m once the regulatory approvals are met, which is expected to be before or by end March 2020; and the balance $ 181 million in 2022.

As he directly and indirectly controls around 80% stake in LOLC Holdings, the historic deal fuelled speculation that Ishara is Sri Lanka’s richest man. Within weeks of the news of the deal, LOLC rose sharply to be ranked as the sixth most valuable listed entity, up from eleventh place in end November. In the past two days, LOLC’s share price has declined, though the Company believes there is upward momentum.

When the Daily FT met him yesterday for an exclusive interview and posed the question “Are you the richest man in Sri Lanka and how do you feel about that?” Ishara’s response was candid: “I don’t like to be labelled like that. It is an accolade, but not a goal, at least for me.”

Pressed further on what his goals are, he replied with a bright smile, “You will see when we get there.”

Claiming the title of most profitable listed entity in Sri Lanka, with a trillion-asset company and over a billion dollars in equity, LOLC in a short span of time has truly emerged, in the words of Ishara, as a “Sri Lankan global player.” Having grown operations in over 10 countries, 80% of LOLC’s Profit before Tax comes from overseas investments.
The exit from its first overseas investment, made in 2007 in PRASAC in Cambodia, is estimated to deliver hefty capital gains. Market analysts estimate LOLC’s original investment in PRASAC was about Rs. 50 billion, and the exit at Rs. 110 billion proves its original instinct and foresight. PRASAC has a lending book of $ 2.5 billion, $ 1,727 million in deposits, $ 2,987 million in total assets, and a customer base of 418,000 as at November 2019.
Nanayakkara says what was important is not why LOLC sold PRASAC, but to whom, and showcased the profile of Korea’s Kookmin Bank, which has over $ 300 billion assets under management.

“This transaction has brought prominence not just to the Group, but to Sri Lanka, Cambodia, and the business community in Asia,” he added.

LOLC Group Managing Director Kapila Jayawardena, who was associated with the interview, chipped in, saying the deal was a significant milestone for LOLC as well as for Sri Lanka. “This is a classic example of value creation. From a country perspective, look at the amount of foreign currency inflow to Sri Lanka as a result of this transaction. I think it is safe to say that this transaction surpasses all other transactions in Sri Lankan corporate history,” Jayawardena added.

Despite the sale of PRASAC, LOLC still have a foothold in the fastest growing Southeast Asian country via LOLC Cambodia, the fourth largest company in microfinance in terms of market position in Cambodia. This is in addition to operations in the Philippines, Indonesia, Myanmar, Pakistan, and the Sultanate of Oman, and a growing footprint in Africa as well through Sierra Leone. LOLC’s investment pipeline is promising, with handpicked locations such as Egypt, Uganda, India, and some strategic locations in the African and Asian markets. For LOLC, 2020 will be a year of further expansion of its overseas investments.

“With the sales proceeds of PRASAC, we are on a better footing to reinvest in other markets, as well as expedite some of our identified investments in the pipeline. This will broad-base our investment portfolio for long-term value creation. This transaction will further strengthen our balance sheet, and we are very positive about the outlook,” said Nanayakkara and Jayawardena.

They said that given the achievements within Sri Lanka, the LOLC Group has been able to use these triumphs as a stepping stone to establish a presence in several countries within the region, and is well set to become the largest multi-geographic, multi-currency MSME platform in the world. “While LOLC is now on track to be a global player, Sri Lanka has built the foundation for our experience and proficiency and will remain the centre of our operations,” they added.

Source: Cassim, N. (2020, Jan 08). Ishara shuns ‘richest man’ tag; says ‘accolade, but not goal’. Retrieved from

LOLC Deputy Chairman
Ishara Nanayakkara