Sri Lanka Cricket expects government assistance to pay for the two new stadia that were the prime contributors to the board’s financial disarray, even though it has wiped over $8 million from its debt since January 2012, SLC treasurer Nuski Mohamed has said.
SLC owed almost $70 million after building international venues in Hambantota and Pallekele, as well as renovating Colombo’s Premadasa Stadium.
“We talked with the national treasury twice about the stadium debt, and we are discussing it with them now,” Mohamed said. “The ICC has also told us that because this debt has had such a major bearing on our balance sheet, we should somehow negotiate to get that money from the government. As far as I see it, the government has said it would look at things and take over that debt, but there has not been a concrete outcome there yet.”
The stadium in Hambantota is understood to have been built on Sri Lankan government’s recommendation. Hambantota was a largely rural district before the tenure of president Mahinda Rajapakse, but it has since had substantial infrastructure development, and now has a functional international airport as well as a port. The cricket stadium forms part of the government’s plan to transform Hambantota into the second major urban hub of Sri Lanka, away from Colombo.
Mohamed said that in addition to making a dent in the debt, SLC had also kept up with ongoing payments, including player salaries, and had settled accounts from the World Twenty20 tournament Sri Lanka hosted last year. Not counting the debt incurred by building stadia, for which government assistance is now expected, Mohamed said he hoped SLC would be debt-free inside two years.
”During the year, we made a profit of 1.369 billion rupees (approx $10.9 million). Most of that surplus went to the payment of capital and interest to the bank, in order to reduce our liabilities. The liabilities we took over at the time were almost US $18.5 million, and I am pleased to inform you that the current liability position is a little over $10 million with the Bank of Ceylon.”
SLC paid outstanding player salaries in February 2012 by obtaining a loan of just over $5 million from the state-owned Bank of Ceylon. Mohamed said the loan taken specifically for player payments had been settled by the middle of last year, but that SLC is still in massive debt to Bank of Ceylon, due to other loans.
”Because we don’t have many tours this year, our cashflow is low,” Mohamed said. “As a result we asked the bank to spread our loan repayments over 36 months, rather than 24 months as originally planned, so that we can get a little bit of relief.”
In addition to asking for a repayment extension, SLC has also proposed a change in the interest rate, in order to assist with the board’s ongoing financial recovery.
“If you look at it on the international level, interest is only about 3 or 3.5%,” Mohamed said. “The interest on the loans given to us are higher than that. I don’t think that given the interest rates in Sri Lanka, they will lower them that much, but even if they lower it by half a per cent or one per cent, that would be a big amount for us.”
