WealthTrust Corporation promotes prudent investments - Chairman
WealthTrust Corporation (Pvt) Ltd, a wealth management company is
involved in correcting anomalies in Sri Lanka’s savings and investment
structure, said its Chairman Ranjit Fernando.
“We are offering a service to the public especially in this turbulent
time, because it is crucial to manage wealth and save our customers’
money prudently,” Fernando told the official launch.
He said that savings play a very significant role to function as a
fund management company to manage customers’ funds. Private wealth
management does not utilise a predetermined model to fit a client. All
portfolios are custom designed for the client based on the investment
guidelines and based on the income or cash flow requirements of
customers, he said
Fernando said that normal banks pay interest between 12 per cent to
14 per cent, which is much below the inflation rate.
This resulted in losing value for deposits for customers. Therefore,
depending on the needs, goals and risk tolerance, customized allocations
within the portfolio may include equities, fixed income securities
mutual funds and subsequently property funds for customers, he said.
He said that people are knowledgeable about the negative impact from
inflation and savings and are tempted to invest in dubious finance
companies for higher returns.
The recent scandals demonstrated that people who had invested funds
were educated and well informed individuals. WealthTrust Corporation (Pvt)
Limited has obtained the licence from the Securities and Exchange
In Sri Lanka low risk instruments give higher returns while high risk
instruments give lower returns and unless this is corrected the capital
and corporate debt markets cannot develop which in turn would impede
growth in the economy, said Executive Director Mangala Boyagoda.
Fund Managers of the company would manage the portfolios for the
clients whose funds will be directly invested in their names and not
through the balance sheet of the company.
Sri Lanka is still a savings nation and not an investor nation and it
is an opportune time to change our savings habits, shifting from the
traditional passbook saving practice to investment, because investment
is the driving force behind any economy, he said.
At present about Rs 1,300 billion is invested in banks while 50 per
cent of them are savings accounts where interest rates are around six
per cent and 20 per cent in current accounts. For Sri Lanka to develop
people need to move away from being savers to investors. Therefore,
people need to be educated on the rewards and risk factors on other
alternative investment products, he said.
Boyagoda said that in Sri Lanka, the corporate bond market is far
behind many other countries in the region because high rates on
government securities make it too expensive for corporates to issues
bonds and investors do not trade their corporate bonds listed on the CSE
preferring to hold them till maturity thus maintaining little in the