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TAMPA, Fla. , Dec. 5, 2024 /PRNewswire/ -- Marpai, Inc. ("Marpai" or the "Company") (OTCQX: MRAI), a technology platform company, which operates as a national Third-Party Administrator (TPA) through its subsidiaries and is transforming the $22 billion TPA market by offering affordable, intelligent, healthcare solutions to self-funded employer health plans, today announced the pricing of a private placement offering consisting of the issuance and sale of 621,194 shares of its Class A common stock (the "Common Stock"), par value $0.0001 per share, at a purchase price of $1.13 per Common Stock, for aggregate gross proceeds of $701,950 . The investors in the offering consisted of an institutional fund and certain officers and directors of the Company. The closing of the offering is expected to occur on or before December 6 , 2024.The company intends to use the net proceeds from the offering for general working capital. The securities issued in the offering are exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act") pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506(b) of Regulation D promulgated thereunder. The securities have not been registered under the Securities Act and may not be sold in the United States absent registration or an exemption from registration. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. About Marpai, Inc. Marpai, Inc. (OTCQX: MRAI) is a technology platform company which operates subsidiaries that provide TPA and value-oriented health plan services to employers that directly pay for employee health benefits. Primarily competing in the $22 billion TPA sector serving self-funded employer health plans representing over $1 trillion in annual claims. Through its Marpai Saves initiative, the Company works to deliver the healthiest member population for the health plan budget. Operating nationwide, Marpai offers access to leading provider networks including Aetna and Cigna and all TPA services. For more information, visit www.marpaihealth.com , the content of which is not incorporated by reference into this press release. Investors are invited to visit https://www.ir.marpaihealth.com Forward-Looking Statement Disclaimer This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties. Forward-looking statements can be identified through the use of words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," "guidance," "may," "can," "could", "will", "potential", "should," "goal" and variations of these words or similar expressions. For example, the Company is using forward looking statements when it discusses the expected closing date and the intended use of proceeds. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Marpai's current expectations and speak only as of the date of this release. Actual results may differ materially from Marpai's current expectations depending upon a number of factors. These factors include, among others, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business. Except as required by law, Marpai does not undertake any responsibility to revise or update any forward-looking statements whether as a result of new information, future events or otherwise. More detailed information about Marpai and the risk factors that may affect the realization of forward-looking statements is set forth in Marpai's filings with the Securities and Exchange Commission. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov . View original content to download multimedia: https://www.prnewswire.com/news-releases/marpai-announces-pricing-of-700-000-private-placement-302324176.html SOURCE MarpaiAt least 65 million tune in for Netflix NFL Christmas Day games. NBA holiday ratings also skyrocket
ST. THOMAS, Virgin Islands (AP) — Javohn Garcia scored 16 points as McNeese beat Illinois State 76-68 on Friday. Read this article for free: Already have an account? To continue reading, please subscribe: * ST. THOMAS, Virgin Islands (AP) — Javohn Garcia scored 16 points as McNeese beat Illinois State 76-68 on Friday. Read unlimited articles for free today: Already have an account? ST. THOMAS, Virgin Islands (AP) — Javohn Garcia scored 16 points as McNeese beat Illinois State 76-68 on Friday. Garcia also contributed seven rebounds for the Cowboys (3-2). Brandon Murray shot 4 of 10 from the field and 5 for 7 from the line to add 13 points. Sincere Parker shot 4 for 8 (2 for 5 from 3-point range) and 3 of 4 from the free-throw line to finish with 13 points. Ty Pence led the way for the Redbirds (3-2) with 14 points and six rebounds. Malachi Poindexter added 13 points for Illinois State. Logan Wolf had 11 points. ___ The Associated Press created this story using technology provided by Data Skrive and data from Sportradar. Advertisement
Once regarded as a secondary market to Los Angeles, Orange County’s food scene has come into its own as of late. Find mom-and-pop shops that have spent decades perfecting a singular dish in areas like Westminster, where Vietnamese food rules , and along Anaheim’s Little Arabia District . For upscale, white-tablecloth dining experiences with higher prices to match are fine dining stalwarts backed by big names. There’s something for everyone in Orange County. Here are the 38 best restaurants in Orange County. Fuoco Pizzeria Napoletana Listed as one of the best pizzas in America by the Washington Post , the pies at Fuoco Pizzeria Napoletana emerge from a nearly 1,000-degree wood-burning oven built in Naples by Stefano Ferrara. Three generations of pizzaiolos continue churning out classic margherita pizzas and the Fuoco pie, which is topped with mozzarella, prosciutto crudo, arugula, and shaved Parmigiano, and drizzled with truffle oil. A mozzarella bar is stocked weekly with cheese imported from Caserta, Italy. A post shared by Tullio Ceccarelli (@fuocopizza) Also featured in: The 16 Essential Pizzerias in Orange County Khan Saab Desi Craft Kitchen This Michelin-recommended halal restaurant combines the flavors of India, Afghanistan, and Pakistan with a modern Californian twist. The tender boneless chicken karahi is served with tomatoes and shishito peppers, and the butter chicken with dried fenugreek is one of the restaurant’s more popular dishes. The pani puri with tamarind water, mint, onion, and potato arrives on a mini cart and is intended to be taken as a shooter. A post shared by Halal Indian/Pakistani Steakhouse, Restaurant + Catering in OC (@khansaab_oc) Also featured in: Save Space for These 22 Orange County Desserts Where to Order Incredible Indian and South Asian Food Adya Chef Shachi Mehra combines her Jersey roots and Indian heritage to create a tangy goat cheese-filled naan. The new RFC sandwich combines flavors of a popular Rajasthani snack, which acts as a coating for crispy fried chicken served inside a custom bun made by Dean Kim’s OC Baking Company. Mehra’s inventiveness garnered her a win on Food Network’s Chopped . Meanwhile, her chef-partner, Sandeep Basrur, combines his background in traditional authentic Indian cooking to prepare classics such as a yellow shrimp coconut curry, dal makhani, and creamy cucumber raita. A post shared by ADYA - fresh Indian flavors (@adyaoc) Kareem's Falafel As one of the first restaurants in Anaheim’s Little Arabia District , Kareem’s remains a go-to for authentic Middle Eastern food. Owner Kareem Hawari’s closely held family falafel recipe is so popular that the Hawaris started selling it wholesale to grocery stores and other restaurants. The baba ganoush, grape leaves, and hummus are staples not to miss, but Kareem’s newer menu items — vegetarian wraps, falafel burgers, and feta fries — also offer a modern Mediterranean vibe without sacrificing traditional flavor. Also featured in: Where to Eat Near Angel Stadium in Anaheim Katella Bakery, Deli & Restaurant The family-owned Los Alamitos landmark founded by Stan Ratman and his wife Shirley is known for its deli food and stocked bakery case that has black-and-white cookies, pastries such as custard-filled eclairs, chocolate chip Danishes, and rugelach. The family-sized portions allow diners to nosh on several dishes at once. Rotund matzo balls are served in Shirley’s chicken soup and rye bread pastrami sandwiches remain a Katella favorite. The vibe is family-friendly with a multi-generational crowd in the dining room, which was remodeled in 2022. The bakery section has illuminated cases filled with slices of layer cakes, cookies, and glistening fruit tarts, baskets filled with bagels, and a smattering of deli items available for takeaway. A post shared by Katella Bakery-Deli-Restaurant (@katella_bakery) Also featured in: 17 Best Jewish Delis in Los Angeles 18 Awesome Orange County Bakeries to Try Right Now Sign up for our newsletter. Check your inbox for a welcome email. Oops. Something went wrong. Please enter a valid email and try again. Shootz At Rodeo 39 Public Market in Stanton, the bustling food hall houses some of the county’s most sought after southeast Asian bites. Beef shank-laden pho from Phoholic and Kra-Z-Kai’s Laotian-style barbecue and sticky rice. At Shootz, reimagined Hawaiian classics include a kimchi butter katsu chicken sandwich stuffed with mac salad and the honey coconut shrimp musubi. Yigah Korean comfort food served in large portions is what Yigah is known for in Orange County. Both the Garden Grove restaurant and its sister location in Irvine at Diamond Jamboree shopping center serve steamy galbi tang, beef short rib soup, as well as the bossam meal with boiled pork belly, napa cabbage, and spicy pickled radish. Also featured in: 15 Essential Korean Restaurants to Try in Orange County Tacos Manuel Santa Ana’s Tacos Manuel truck, open Tuesday through Sunday from 11 a.m. to 10 p.m., serves corn tortilla street tacos with carnitas, chorizo, carne asada, al pastor, and chicken. Most regulars opt for the offals, such as cabeza and tripas (tripe), served with grilled onions, jalapenos, and cilantro. The truck also makes quesadillas, tortas, and burritos, but the huaraches topped with beans, lettuce, sour cream, and meat are the most popular. A post shared by Best Food (@bestfood_aroundtheworld) Omakase by Gino Sushi chef Gino Choi prepares an intricate omakase for 10 diners at his namesake downtown Santa Ana restaurant. (Choi is also a self-taught carpenter who built the sushi counter, entryway, and partitions himself.) Standout dishes include a creamy Hokkaido uni udon garnished with winter black truffles from Spain; Gino’s version of tamago, flavored with shellfish; and a yuzu foam topped with slow-cooked black cod bedded alongside green plum marinated roasted tomatoes. Also featured in: 15 Splurge-Worthy Sushi Restaurants in Orange County Phoholic The hearty portions of Phởholic’s hot beefy pho keep Vietnamese grandparents and social media influencers returning to its original location in Westminster. Owners Gordon and Cathy Pham have opened two more locations , one at South Coast Plaza and another at Rodeo 39 in Stanton. Pham’s parents run the kitchen where the family’s decades-old recipe requires the broth to simmer for 14 hours. Regulars opt for the beef shank and oxtail pho on the “holic” side of the menu, but beginners can start with the steak and brisket version. Nok’s Kitchen Chef Nokmaniphone Sayavong’s Laotian food built a cult following with her grilled sausage and tum mak huong, grated papaya salad mixed with tomato and seasoned with fish sauce. The herbaceous pork sausage should be eaten with sticky rice, a Laotian staple, and dipped in tangy spiced jeow som, interspersed with bites of fresh cucumber. The khao pad, her signature fried rice, comes with either tofu, chicken, pork, shrimp or crab. The restaurant recently moved to a new location on Bolsa Avenue. Brodard Restaurant This timeless restaurant offers a wide array of Vietnamese specialties, starting with 13 types of spring rolls — including the popular grilled shrimp paste with lettuce, carrots, daikon, mint, cilantro, and cucumber wrapped in rice paper. The menu continues with traditional Vietnamese noodle soups, sandwiches, and much more. Also featured in: The 23 Essential Vietnamese Restaurants in Little Saigon, Orange County Save Space for These 22 Orange County Desserts Nep Cafe Nep Cafe is a brunch sensation. At the French Vietnamese all-day cafe, run by the massively successful restaurant group Kei Concepts , the kitchen pays “homage to the traditional Vietnamese morning routine.” The menu includes TikTok-worthy coffee drinks topped with salted egg yolk and delicate dishes like sous vide egg kicked up with hints of truffle. Nep’s second location in Irvine opened in the same plaza as Kei Concepts’ Sup Noodle Bar. Also featured in: The 23 Essential Vietnamese Restaurants in Little Saigon, Orange County The 21 Best Brunch Options in Orange County Terrace by Mix Mix Ross Pangilinan’s Terrace by Mix Mix is known for its open-air patio and the chef’s large raviolo. The hand-rolled pasta is stuffed with a cheese-herb filling and a whole egg yolk. Other popular items include an albacore crostini on a crispy corn tostada and brioche french toast for brunch. Filipino-inspired dishes, including his adobo and lumpia, stand out as nods to Pangilinan’s roots. Also featured in: The 21 Best Brunch Options in Orange County Vaca Top Chef: All Stars’ Amar Santana opened this sleek Spanish hideaway in 2016 inside the Segerstrom Performing Arts Center. Aged steaks hang from illuminated cases as if perched in a sleek showroom. For lunch, the lamb burger is punched up with feta, sumac onion, and red pepper jam. Those looking for paella will find options with saffron-hinted bomba rice. But the sharable tapas are the most fun. The chef’s snacks rotate often, but the creamy chicken croquettes and warm pulp with fingerling potatoes drizzled in Spanish olive oil remain mainstays since it opened. Knife Pleat This modern French-Californian restaurant from chef Tony Esnault and Yassmin Sarmadi is ripe for celebratory meals. The three-course lunch and four-to-six-course dinner prix fixe menus change often. One week, it’s French black truffles; another evening, it’s a Norouz dinner with recipes by Shamsi Katebi, prepared by Esnault and his kitchen team. Its plush banquets and round tables overlook the bar and open kitchen. A sunlit patio is typically booked with private weekend events, and a pricey but impeccable afternoon tea service is available on Saturdays. The surprisingly satisfying non-alcoholic cocktails, like the Cadillac margarita with blood orange and lime, are also worth stopping in for. Also featured in: The 18 Best Places for Afternoon Tea in Los Angeles Los Angeles’s 2024 Michelin Stars, Mapped A&J Restaurant This Taiwanese restaurant in Irvine serves Chinese-style crispy pork chop over rice and thousand-layer pancakes, but the noodle dishes are not to be missed, including a beef noodle soup and noodles with ground pork. For diners who enjoy heat, the menu also features several Sichuan-style dishes, like a beef tendon noodle soup and spicy wontons. A post shared by A&J Restaurant (@ajrestaurant) Also featured in: The Best Chinese Restaurants Around D.C. Where to Eat and Drink in Rockville Hana re The omakase-only Hana re is a 10-seat sushi-ya helmed by Atsushi Yokoyama. Located in an industrial storage crate at the Lab in Costa Mesa, the Michelin star counter feels like a hidden gem, even though its stellar fish preparations are no secret anymore. Yokoyama and one server, who also assists with wine pairings, put out an omakase experience that includes bite sized crab perched atop eel tempura, scallops enveloped in gelee, welk shellfish with celery root, caviar and shiso. Reservations can be made via text at (714) 545-2800 for the $250 omakase. A post shared by Wu Jiang (@w499340317) Vibe Organic Kitchen & Juice The gluten-free, organic, and vegan cafe serves breakfast options all day. The blue-colored spirulina chia pudding with fresh fruit and the tacos made with house-made corn tortillas, cauliflower scramble, pico de gallo, and cashew lime crema are snackable any time of day. For vegan beginners, the cafe serves acai bowls with cacao nibs, an extensive menu of made-to-order juices and smoothies blended with homemade coconut milk, and a kid-friendly organic mixed berry waffle with cashew cream and maple syrup. A post shared by Vibe Organic Kitchen & Juice (@eatdrinkvibe) Fermentation Farm Probiotics rule at Fermentation Farm — thanks to nearly a dozen different on-tap kombucha flavors, and food options like a French onion soup with raw cheese and a kraut-filled grilled cheese sandwich. Visit on Thursdays from 11 a.m. to 2 p.m. when a farmers market featuring produce from Rosewood Farms and Sunny Cal Farms pops up in the restaurant’s parking lot. Monthly classes include an intro to bone broth and fermentation techniques like kombucha brewing. A new location opened at River Street Marketplace in San Juan Capistrano. A Restaurant This cozy, red booth hideout on Pacific Coast Highway is known for its Rat Pack atmosphere. The classic martini reigns at the bar and the chicken pot pie is only available on Fridays, but locals love the steaks, the confited Mary’s organic chicken, and pan-seared Niman Ranch pork chops. Put simply: the restaurant is old-school done right. River Jetty Restaurant Group also operates A Restaurant’s sister locales CDM Restaurant, A Crystal Cove, and A Market, which are go-to hot spots in Newport Beach. Fable & Spirit A meal at Fable & Spirit, almost by default, starts with warm Guinness brown bread with European butter and Jacobsen sea salt. From there, the Lido Isle restaurant weaves between European meat and potato influences to pure Californicana, like citrusy salads loaded with cara cara and blood oranges, chevre, and crispy quinoa. Chef David Shofner and the Coyle family are also known for popular Mission Viejo restaurants Wineworks for Everyone and Dublin 4 Gastropub. Also featured in: Orange County's 12 Best Restaurants The 21 Best Brunch Options in Orange County Sushi II The splurge-worthy Sushi II is located in Mariner’s Point in Newport Beach and offers three hyper-seasonal omakase experiences. Named after distinct Japanese pottery — Bizen, Oribe, and Karatsu — the menus range from $150 to $275 per person. At lunch, chirashi starts at $35 and omakase is $120. Order the omakase paired with sake to experience master chef Susumu Ii’s washoku training to the fullest. The takeout offerings, such as the deluxe chirashi ($48) and a classic Japanese cherry blossom chirashi for $27, are exquisitely packaged for impressive meals on the go. A post shared by Sushi ii (@sushi_iirestaurant) Also featured in: 15 Splurge-Worthy Sushi Restaurants in Orange County Farmhouse at Roger's Gardens Chef Richard Mead is a long-standing figure in the Orange County dining scene. At the Farmhouse at Roger’s Gardens, the chef showcases the best that the season has to offer from the region’s many producers, which means ever-changing takes on dishes like sea scallops, as well as shrimp and mussels served in a tomato-Pernod broth with a polenta cake made from blue corn sourced from the Tehachapi Heritage Grain Project. Also featured in: Save Space for These 22 Orange County Desserts The 21 Best Brunch Options in Orange County Marché Moderne Florent and Amelia Marneu’s white tablecloth restaurant is a stalwart in the Orange County fine dining scene. The Newport Beach restaurant serves traditional French favorites such as roasted bone marrow and duck confit. Amelia’s chopped salad with French feta, cucumber, mint, and honey grapefruit vinaigrette showcases California produce. Other standout dishes include hamachi with a jalapeno-tinged mango-yuzu sorbet, rabbit confit stuffed cannelloni, and the rotating desserts crafted by the Marneus. Also featured in: Save Space for These 22 Orange County Desserts Heritage Barbecue San Juan Capistrano’s award-winning pitmaster Daniel Castillo takes barbecue to the next level with wood-smoked brisket, sausages, turkeys, ribs, chickens, and more. First-timers load up on the brisket and ribs, while regulars order pork belly banh mi sandwiches, brisket tacos prepared with La Palma tortillas, and creamy banana pudding layered with pound cake and vanilla wafer cookies. Get the charred broccoli with cheesy mornay sauce if it’s on the menu. Also featured in: Save Space for These 22 Orange County Desserts 21 Road Trip-Worthy Barbecue Destinations Outside of Los Angeles Mayfield George Barker opened Mayfield in 2020 and sparked a new dining movement in San Juan Capistrano. The food is influenced by Levantine regional flavors, with hints of North Africa, the Mediterranean, and the Middle East mixed with California. There’s a solid burger with harissa aioli at happy hour and za’atar fried chicken for dinner. For brunch, there’s avocado toast and egg sandwiches, but there are also Turkish eggs with labneh and fiery tomato shakshuka, showcasing the variety from the kitchen. The restaurant is also known for its cocktails, one of which is featured monthly and whose proceeds are given to a local cause. Kahani Deep in Orange County, hidden away in the Ritz-Carlton Laguna Niguel, chef Sanjay Rawat prepares what could be the most incredible Indian fine dining that Southern California has seen. Rawat’s inventive and playful presentations don’t hold back on flavor in a venue that was previously a staid hotel steakhouse. It’s clear that Rawat and his immense wedding feasts for the property translate into something that OC diners can wrap their heads around, like the spiced Chilean sea bass with roasted delicata squash or the exceptional rack of lamb over forbidden rice and handi sauce. — Matthew Kang, lead editor Also featured in: The 21 Best Indian and South Asian Restaurants in Los AngelesTesla shares rose to a historic high on Wednesday, beating the electric car maker’s previous record from 2021, which was set after the post-election rush and renewed Wall Street enthusiasm for Elon Musk’s electric vehicle empire. This is due to the fact that stock hit a closing price of $424.77 more than doubling its previous peak of $409.97 on November 4, 2021. The electric car company’s 71% gain this year has been propelled more by the optimism generated with Donald Trump’s victory during the elections than its early performance woes. Record-Breaking Stock Surge For Tesla Tesla’s stock price rallied 38% in November, the best monthly performance since January 2023 and its 10th best month on record. The surge in Tesla’s market capitalization was fueled by investor optimism over Trump’s victory early last month, which has dramatically influenced the trajectory of the company’s stock. This increase in share value has surprised investors, especially since Tesla was off to a rocky start for the year. With a 29% loss in the first quarter of 2024, Tesla’s shares have bounced back considerably, recovering from their worst performance in over a year. The rise in Tesla’s shares has been termed as the “Trump bump” by many analysts. As Craig Irwin, an analyst of Roth MKM, had commented on CNBC’s Squawk on the Street, that “Musk’s genuine backing for Trump likely doubled the pool of enthusiasts and heightened credibility for an inflection in demand.” Irwin raised his price target of Tesla to $380 versus $85, after winning the election by Trump. Musk’s active involvement in Trump’s campaign and post-election strategies has further solidified the link between the two figures. In the lead-up to the election, Musk reportedly invested $277 million into pro-Trump efforts, focusing on swing-state operations aimed at voter registration. Additionally, Musk’s social media platform, X, became a vehicle for promoting Trump’s candidacy and further galvanizing Tesla’s support base. Musk’s Expanding Influence And Role Of AI Elon Musk ‘s influence does not seem to be dissipating anytime soon, especially after President Trump’s election win and his appointment as an adviser in the new administration. “Department of Government Efficiency,” led by former Republican presidential candidate Vivek Ramaswamy, will supposedly be headed by Musk himself. This influential position is likely to give Musk leeway to oversee federal agency budgets, staffing, as well as push for the end of regulations that would really hinder Tesla’s growth. Musk’s position may affect Tesla significantly, especially on the technological advancement of its autonomous vehicles. A long-time advocate for autonomous driving, Musk shared in a Tesla earnings call last October his plan to use his political power to “get federal approval process for autonomous vehicles” and bypassing the state-by-state level approval system. Wall Street’s Brighter Future Ahead For Tesla Analysts have been growing more bullish on the prospects of Tesla as it continues its upward trajectory. Goldman Sachs upgraded its price target for Tesla, and the list of financial institutions that have upgraded their outlook on the stock continues to grow. In its report, Goldman analysts cited the market’s forward-looking approach towards Tesla, particularly with regard to its artificial intelligence (AI) initiatives. Other investment firms such as Morgan Stanley and Bank of America also released positive reports about Tesla, noting the company’s ability to cash in on newer technologies such as AI and autonomous driving. These positive reports have been strengthening investor sentiment, further fueling a price hike of the stock. Despite the dismal first half of 2024, Tesla’s third-quarter earnings report in October reported that revenue was up 8% year-over-year, narrowly missing analysts’ expectations, but the company did blow past profit estimates. Even more encouraging was Musk’s forecast for 2025: a 20% to 30% rate of vehicle growth, underpinned by “lower-cost vehicles” and the start of autonomy. Musk’s forecast was more positive than analysts had expected, which reflects a level of confidence in Tesla’s ability to adapt and thrive in an increasingly competitive market. As Tesla continues its journey in the electric vehicle sector, it will be interesting to see how the company will leverage its recent stock surge and the growing interest in emerging automotive technologies. ALSO READ | Donald Trump Earns Time’s ‘Person Of The Year’ Honor For Second Time: Reports
President Anura Kumara Dissanayake, AKD in short, in his address to Parliament on 21 November 2024, announced two strategies to make Sri Lanka a thriving nation and a beautiful country under the rule of his political alliance1. One is immediate, picking the low hanging fruits in common parlance, and the other is medium to long-term that will create a turning point in the economy. This requires investment of funds for providing working capital to maintain the existing level of output, known commonly as GDP, and for investment capital for expanding the size of the economy. The necessary funds for investment should be provided by domestic savings generated by the Government and the people by consuming less than the income. If there is a paucity of such savings, funds should be acquired from external sources – use of the savings made by foreigners – by way of grants, direct investments, investment in the share market or Government securities or loans from friendly countries or commercial markets. This last source is not immediately available to Sri Lanka since it will take time for the country to create conditions conducive for attracting such funds. Hence, the major emphasis should be placed in the current period on domestic savings. Financial institutions will supply domestically generated funds by mobilising savings from the public and making the same available to prospective fund users by way of loans. They will also expand their supply base by creating multiple deposits and credit using the reserve money being supplied by the Central Bank. Hence, the main responsibility for funding the economy rests on financial institutions. According to the financial results released by commercial banks for the first nine months, they have made after tax thumping profits. While there is no objection to their making profits – because they are profit making institutions – they should also help the economy to come out of the present low growth scenario. The economy has just come out of a prolonged recession2 till the second quarter of 20233. The period ahead is also not promising since the average annual economic growth is projected to be at around 3% during 2024 to 2026,4 much lower than the average annual growth rate of 4.5% maintained by the country in the post-independence period.5 Any major internal or external economic shock disrupting economic activities could push this positive low growth to the negative region making matters more complicated for banks as well as for people. In this background, banks are expected to adopt conservative strategies to protect their balance sheets and consequentially, the funds supplied by depositors. To attain this goal, they should be selective in lending, shun borrowers devoid of potential to repay, increase interest rates to mitigate the risks and uncertainties, and consolidate existing good borrowers to keep the non-performing loan portfolios at a level that will not dent the net worth. The country is presently going through a deflationary situation with the inflation rate moving to the negative region at 2.1%% by end November 20246. This is an underperformance in relation to the flexible inflation target of the Central Bank under which the annual inflation should be maintained at least at 3% per annum. Hence, the central bank has space to cut the interest rates further and expand the credit levels. Commercial banks and other financial institutions should align themselves to this new development. For that, they should come up with innovative loan products to help the borrowers. This is a conflicting choice because attaining one goal will necessarily mean sacrificing the other. Following either goal exclusively is disastrous for banks as well as for the national economy. If banks end up with toxic balance sheets due to following the national goal of expanding inclusive lending, the stressed financial system will be a burden to the taxpayers. This is because, in terms of the new Central Bank Act, it is the responsibility of the Government to bailout problem financial institutions by providing solvency financing, known as long-term capital, to them. For that purpose, the Central Bank’s money printing power cannot be used except for liquidity financing in the form of short-term funds which is only supplementary to the major bailout packages being offered.7 Hence, the full burden of rescuing a sick financial system devolves on the taxpayers who are also stressed by the high levels of taxes they must pay as individuals. With the limited capacity within the Treasury, it is unlikely that the Government could provide the needed funding for rescuing a sickened financial system. But if banks follow an exclusive strategy of protecting their balance sheets, the timeline of the needed economic recovery will be shifted to the future making it difficult for banks to prosper in a slow-recovering economic system. Banks being creators of financial assets can prosper in the long run only if the real economic activities are doing well. If the real economy does not perform well, assets of banks which are solid in good times will start melting down leading to a severely disastrous financial crisis in the long run. This was the main cause of the global financial crisis of 2007-9 in which aggressive housing loans of US banks granted without due diligence became non-performing due to the slowdown of economic activities.8 Hence, in a recession-hit economy, the job of a banker is like that of an acrobat walking on a tight rope. In the circumstances, how should the banks strike a compromising balance between these two conflicting objectives? They cannot go against the national policy individually or as a system jointly. Any quick recovery will benefit them more than any other economic agent within the system. Hence, it is in the interest of the banks to help the government achieve a quick economic recovery and banks can do so by expanding the lending base. But this does not mean that banks should relax their loan assessment criteria to accommodate the increased demand for loans which may have failed to pass the test of prudence in terms of viability or purpose. Viability will ensure that the borrowers have the potential to service the loans as agreed. The purpose will ensure that they will make the highest contribution to the national product so that they will help the economy to attain a quick recovery. Complying with both requirements will help banks as well as the national economy since both are connected to each other like the bark to the trunk of a tree. Hence, banks should make a fair number of internal adjustments to gain capability for playing the game safely. These adjustments are strenuous, and pain-stricken but necessary if both the national economy and the individual banks are to succeed in a low-performing economy. The following, while not being exhaustive, are some of those adjustments that should be made forthwith. Capacity development of the staff by retraining them to assess the loan applications of the stressed-out borrowers: In a recession-hit economy, like the bankers, the borrowers are also stressed-out due to the struggle which now they must make first to survive and then to succeed in a secured livelihood. Hence, any loan being granted is a measure to take that stress out of him. That requires a banker to extend a supportive hand to the borrower. If he does not do so, the prospective borrowers will be driven to the informal money lenders who will supply the needed funds more conveniently but at rates and under conditions that will not help them to sustain their businesses. Informal money lenders deliver loan funds within hours of agreeing to the borrowing arrangements.9 It is a convenience to the borrowers. However, the borrower should pay interest at about 10% per month and repay the full amount within 100 days in which instalments are recovered daily.10 It is this last condition which puts the borrower in a tight jacket because it is unlikely that he will be able to earn enough liquid cash daily to service the loan. Consequently, many borrowers have been driven to eternal indebtedness from which they can never escape. Therefore, the supportive hand which a banker should extend to a stressed-out borrower should necessarily involve a loan product that is delivered conveniently, on one hand, and helps the borrower resuscitate his business and make a positive contribution to the growth of both the lender and the national economy, on the other. This also requires the banks to change their lending policy. Building a risk reserve to accommodate failing loans: Lending by adopting a relaxed loan assessment strategy to help the stressed-out borrowers is a risky affair. Many loans can become non-performing because the economic environment faced by these borrowers may suddenly change due to unfriendly man-made as well as natural external shocks. Of the man-made shocks, the change in the government policy to the disadvantage of the borrower concerned is prominent. For instance, the Government which is bent on raising its revenue base irrespective of its adverse impact on the recovery or the sustenance of the economy may impose new taxes that will completely derail the business line of the borrower concerned. For instance, take the case of a borrower who is in the handloom fabric weaving business. If a new value added tax is imposed on the locally made fabric, the borrower concerned is unable to sell his product in the market according to his previous sales projections. If his cash flow is disrupted due to the declined sales, he is unable to service his loan. Similarly, external economic shocks may also disrupt his cash flow projections. If the borrower’s project fails due to these factors beyond his control, the loan can become non-performing. To cover the risks arising from such non-deliberate loan defaults, there should be a risk covering reserve funds within the bank. This is in addition to the provisions made under Basel accords.11 This fund can be established by transferring a portion of the profits of a bank. If a bank follows this policy, it need not depend on the Government’s support to prevent its balance sheet from becoming toxic. Effective supervision of loans granted to stressed-out borrowers: Loans can become non-performing when the project for which the bank has granted a loan is not effectively supervised by the banker. This happens specifically in the case of micro and small and medium enterprise loans. This MSME sector is the backbone of the economy since it is responsible for more than a half of the total employment and the output in the economy.12 Close supervision by the banker will allow him to identify in advance the problems brewing in a business of a borrower and take effective preventive action to avoid loan losses. Introducing a venture capital type financing for start-up businesses:13 In an economy which is recovering from recession, the new entrants to business will provide an additional impetus to its recovery process. The way to accommodate such start-ups is through venture capital financing, in which the banker and the start-up entrepreneur get together to make the business dream of the borrower a reality. The technical knowhow and the business acumen are possessed by the prospective new entrepreneur. The banker supports him by providing the necessary capital and managerial cum business wisdom to him. In this case, the banker is not a lender, but a part owner. If the business fails, the bank is also required to assume losses. Because of this risk factor, the banker has all the reasons to effectively participate in the management of the business. But to do so, the bank’s staff should be retrained to provide the necessary managerial inputs to a start-up business. It is also necessary that the bank should employ workers with multiple disciplines, like finance, management, science, technology, or engineering. They should be provided with tailor-made training to make them effective participants in a business venture. In summary, the role of a banker in a recession-hit economy is different from his role in a well performing economy. He is required to protect his balance sheet from becoming toxic because he has the prime responsibility to protect the funds of the depositors. But at the same time, he cannot ignore the role that he should play in helping the economy to attain a quick economic recovery. Such a recovery is essential for him to succeed in the long run as a banker. The asset base of a banker is solid if the economy is solid. If the economy does not perform well or below its potential, the asset base will begin to melt down, forcing him to close doors. Such an eventuality can be avoided if the banker adopts strategies to make a difficult but necessary internal adjustment. This is like walking on a tight rope balancing the conflicting personal interests and the needs of the national economy. It is those banks which can strike the right balance that will succeed in a recession-hit economy. 1 An English translation is available at: https://pmd.gov.lk/news/the-full-speech-delivered-by-president-anura-kumara-dissanayake-at-the-inauguration-of-the-first-session-of-the-tenth-parliament/ 2 A practical definition of an economic recession is recording a negative economic growth for two consecutive quarters; an economic depression is a severe recession with a negative annual growth of more than 10%; see: https://www.imf.org/external/pubs/ft/fandd/2009/03/pdf/basics.pdf . 3 Department of Census and Statistics, Growth of Quarterly GDP at Constant Prices 2016-2023. 4 IMF, Sri Lanka Country Report 23/116. 5 Central Bank of Sri Lanka, Annual Report 2022, Special Statistical Appendix, Table 2. 6 https://www.statistics.gov.lk/InflationAndPrices/StaticalInformation/MonthlyCCPI/CCPI_20241129E 7 Section 36 of the Central Bank Act provides for the grant of such liquidity financing only to ‘solvent’ financial institutions. Hence, insolvent financial institutions cannot get even the liquidity financing from the central bank. Liquidity financing to insolvent financial institutions can be made by the central bank in exceptional circumstances on an ‘unconditional and irrevocable’ guarantee given by the government. 8 See: https://www.rba.gov.au/education/resources/explainers/the-global-financial-crisis.html#:~:text=The%20catalysts%20for%20the%20GFC,built%20houses%20in%20some%20areas. . 9 For details of Sri Lanka’s informal money market, see, Berensmann, Kathrin et.al , 2002, Informal Financing of Small Scale Enterprises in Sri Lanka, Working Paper 10/2002, German Development Institute, Bonn. 10 Wijewardena, W.A., 2019, “Fixing Lending Rates and Waving Farmer Loans: Two Policies That Do Not Augur Well For Borrowers” Colombo Telegraph, https://www.colombotelegraph.com/index.php/fixing-lending-rates-waiving-farmer-loans-two-policies-that-do-not-augur-well-for-borrowers/ . 11 For details, see: Majnoni, Giovanni at.al., 2004, Bank Capital and Loan Loss Reserves Under Basel II: Implications for Emerging Countries”, World Bank Policy Research Working Paper, 3437; https://documents1.worldbank.org/curated/en/426261468765318403/310436360_20050014104409/additional/WPS3437.pdf . 12 Wijewardena, W.A., 2023, Misconceived resilient economy needs fixing by restoring broken supply chains, Daily FT; https://www.ft.lk/columns/Misconceived-resilient-economy-needs-fixing-by-restoring-broken-supply-chains/4-753818 . 13 For details, see: Davila, Antonio, Foster, George and Gupta, Mahendra, 2000, Venture Capital Financing and the Growth of Startup Firms, Research Paper No 1667, Graduate School of Business, Stanford University.
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