• Statement Made by the Central Bank of Sri Lanka on Regulation and Supervision of Non - Bank Financial Institutions

    The Central Bank of Sri Lanka (CBSL) has noticed several media reports that vests the responsibility of failure and subsequent cancellation of licence of several finance companies which were licensed under the Finance Business Act, No. 42 of 2011 (FBA).

    The CBSL carries out the regulation and supervision of licensed finance companies (LFCs) to ensure and strengthen the stability of the LFCs and in turn the stability of the financial system, which is one of the core objectives of the CBSL. Such stability is ensured through minimum capital, minimum liquidity, and provisioning requirements; regulation of investments to reduce concentration risk and corporate Governance requirements.

  • The Central Bank of Sri Lanka’s COVID-19 Relief Measures: How are we helping the Country, Economy and YOU?

    This press statement aims to create public awareness about the operational and policy measures undertaken by the Central Bank of Sri Lanka thus far during 2020, to support the economy, the financial system and the general public in the midst of the COVID-19 pandemic. Being the apex financial institution of the country, the Central Bank provided its full scope of essential services to the economy and the financial system during the lockdown. The Central Bank actively took steps to ease the burden on the general public during this unprecedented disruption of global scale, while preserving the focus on its legal mandate to maintain economic, price and financial system stability.  

  • Central Bank Approved Rs. 28 Billion Loans at 4% among 13,861 Businesses Affected by the COVID-19 Outbreak

    Having identified the urgent need of reviving the businesses adversely affected by the COVID-19 outbreak and thereby to promote economic activity in the country, the Central Bank and the Government of Sri Lanka launched a novel refinance facility under the Saubagya (Prosperity) Loan Scheme, named Saubagya Covid-19 Renaissance Facility, as announced on 24 March 2020.

  • NCPI based Inflation decreased further in May 2020

    Headline inflation as measured by the year-on-year (Y-o-Y) change in the National Consumer Price Index (NCPI, 2013=100) decreased further to 5.2 per cent in May 2020 from 5.9 per cent in April 2020. This was mainly driven by the statistical effect of the high base prevailed in May 2019. Meanwhile, Food inflation (Y-o-Y) declined to 11.1 per cent in May 2020 from 12.2 per cent in April 2020 and Non-food inflation (Y-o-Y) also declined to 0.8 per cent in May 2020 from 1.1 per cent in April 2020.

  • External Sector Performance - April 2020

    Sri Lanka’s external sector performance in April 2020 was severely affected by the COVID-19 pandemic related economic interruptions. The imposition of a partial lockdown had a significant impact on Sri Lanka’s merchandise exports sector while shutting down the tourism industry in April 2020. The expenditure on merchandise imports also declined, with disruption to import related supply chains and restrictions imposed on non essential imports by the government and the Central Bank. With some migrant workers returning to the country prior to the lockdown and reduced compensation and redundancies faced by some migrant workers abroad, a significant decline was recorded in workers’ remittances during the month.

  • The Central Bank of Sri Lanka Implements New Credit Schemes to Support the Revival of the Economy

    Growth of the Sri Lankan economy has fallen to dismal levels over the past few years, and the impact of the COVID-19 pandemic may result in severe stress on economic and financial system stability in the period ahead unless immediate remedial actions are taken. In this context, in support of the government’s efforts to revive the economy, the Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 16 June 2020, decided to introduce new credit schemes under the Section 83 of the Monetary Law Act No. 58 of 1949.

  • The Central Bank of Sri Lanka Further Reduces the Statutory Reserve Ratio

    The Monetary Board of the Central Bank of Sri Lanka, at its meeting held on 16 June 2020, decided to reduce the Statutory Reserve Ratio (SRR) applicable on all rupee deposit liabilities of licensed commercial banks (LCBs) by 200 basis points to 2.00 per cent, with effect from the reserve maintenance period that commenced on 16 June 2020. This reduction in the SRR injects around Rs. 115 billion of additional liquidity to the domestic money market, enabling the financial system to expedite credit flows to the economy, while reducing the cost of funds of LCBs. 

  • Sri Lanka Purchasing Managers’ Index - May 2020

    Manufacturing sector PMI recorded a noticeable bounce in May 2020 reaching to 49.3, which is an increase of 25.1 index points, from the all-time low of 24.2 recorded in April 2020. The gradual easing of restrictions for mobility has contributed to the resumption of economic activities in the manufacturing sector.

  • Statement by Deshamanya Professor W.D. Lakshman Governor of the Central Bank of Sri Lanka

    There has been speculation by various groups and individuals that Sri Lanka’s financial system and financial institutions are in a weak position and that the general public is at risk of losing their deposits made at those institutions.

    As the regulator of both banking and non-bank financial institutions that accept public deposits in the country, the Central Bank of Sri Lanka wishes to assure the general public that it will continue to take all possible measures to ensure the safety of public deposits. Hence this statement to educate the general public on the true state of affairs about financial institutions and their stability.

  • Compensation Payments to the Depositors of The Finance Company PLC under Sri Lanka Deposit Insurance and Liquidity Support Scheme

    The license issued to The Finance Company PLC (TFC) to carry on finance business has been cancelled with effect from 22.05.2020 in terms of the provisions of the Finance Business Act No. 42 of 2011.

    The Central Bank of Sri Lanka (CBSL) has taken steps to pay compensations up to Rs.600,000 to all insured depositors as per the Regulations of Sri Lanka Deposit Insurance and Liquidity Support Scheme. The balance amount if any, will be settled after liquidation of properties belong to TFC. The compensation payments will be made through the People’s Bank as the agent bank appointed by CBSL for this purpose. The first phase of the compensation payment for the individual depositors having a single deposit, will be commenced on 7th June 2020 at People’s Bank branch locations where TFC branches were previously operated. 

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