Thursday, March 12

Tag: Monetary Board

Sri Lanka Central Bank imposes 100% margin deposit requirement against Letters of Credit (LCs) for vehicle imports
20Sep By Faraz ShauketalyNo Comments
Business

Sri Lanka Central Bank imposes 100% margin deposit requirement against Letters of Credit (LCs) for vehicle imports

The Monetary Board of the Central Bank of Sri Lanka has imposed a 100 percent margin deposit requirement against Letters of Credit opened with the commercial banks for the import of motor vehicles, which are generally used for non-commercial purposes, with immediate effect, the Bank announced today. Accordingly, Letters of Credit for the importation of these vehicle categories could be done only with a minimum cash margin of 100 per cent. The Bank said the decision to impose the margin deposit requirement is based on recent developments which, if not addressed, could threaten macroeconomic stability. Recent global financial market volatility and generalized pressure on currencies of emerging market economies and continued excessive motor vehicle imports, partly driven by unwarrant...
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Central Bank commences compensation payments to insured depositors of CIFL
28Aug By Faraz ShauketalyNo Comments
Business

Central Bank commences compensation payments to insured depositors of CIFL

The Central Bank of Sri Lanka Monday announced that the compensation payments for insured depositors of Central Investments and Finance PLC (CIFL) will be paid with effect from 27 August 2018. The payments are made in terms of Sri Lanka Deposit Insurance Scheme Regulation No.01 of 2010 (as amended) (SLDILSS Regulations). The Monetary Board cancelled the license issued to Central Investment and Finance PLC (CIFL) with effect from 5th March 2018 in accordance with Section 37(3) of the Finance Business Act. The payment process will be continued until all eligible depositors of CIFL who have claimed their dues are paid. Therefore, CBSL requested the eligible depositors to wait until officially inform the collection of their payment. Further, with the Monetary Board decision to canc...
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Sri Lanka maintains policy rates to sustain inflation at mid-single digit levels
11May By Faraz ShauketalyNo Comments
Business

Sri Lanka maintains policy rates to sustain inflation at mid-single digit levels

Sri Lanka's Central Bank releasing the monetary policy review on Friday said based on the current developments and outlook for key macroeconomic variables, the Monetary Board of the Central Bank was of the view that the continuation of the current monetary stance is suitable. Accordingly, the Monetary Board at its meeting held on 10 May has decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank unchanged at 7.25 percent and 8.50 percent, respectively while the Statutory Reserve Ratio remains at 7.50 percent. In arriving at this decision, the Board took into consideration the recent global market developments, the macroeconomic impact of recent adjustments in administered prices, and the fact that more time is ne...
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Sri Lanka reduces lending rate to boost economic growth, dampen volatility in interest rates
4Apr By Faraz ShauketalyNo Comments
Business

Sri Lanka reduces lending rate to boost economic growth, dampen volatility in interest rates

The Central Bank of Sri Lanka (CBSL) has decided to reduce the lending interest rate by 25 basis points with immediate effect. The Bank said considering the favorable developments in inflation and inflation outlook as well as lower than expected real GDP growth that further widened the prevailing gap between actual and potential GDP growth, the Monetary Board, at its meeting held on 03 April 2018, decided to reduce the Standing Lending Facility Rate (SLFR) by 25 basis points. Accordingly, the Monetary Board has decided to maintain the Standing Deposit Facility Rate (SDFR) unchanged at 7.25 percent and reduce the Standing Lending Facility Rate (SLFR) to 8.50 percent, while the Statutory Reserve Ratio remains at 7.50 percent. Releasing the policy stance, the Central Bank said this d...
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Central Bank rejects news report claimed State Minister’s request to implement ‘ICTA’s shoddy payment gateway’
29Mar By Faraz ShauketalyNo Comments
Business

Central Bank rejects news report claimed State Minister’s request to implement ‘ICTA’s shoddy payment gateway’

The Central Bank today said a claim in a recent news item that State Minister of National Policies and Economic Affairs Dr Harsha de Silva had "summoned the Monetary Board to his Ministry and asked the Board to implement ICTA's shoddy payment gateway" is unfounded. Clarifying the issue in a statement, the Central Bank said the State Minister convened a meeting of stakeholders to resolve a longstanding issue regarding the way forward on a National Payments Platform. "This was important to facilitate the digitalization of the economy," the Bank said. The Central Bank said two independent members of the Monetary Board expressed an interest in participating in the meeting to assist in finding a solution to a long outstanding issue. A consensus was reached on the way forward at this me...
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CB keeps policy rates unchanged: Economy currently operating below potential
15Feb By Faraz ShauketalyNo Comments
Business, Main Story

CB keeps policy rates unchanged: Economy currently operating below potential

Sri Lanka will keep policy rates unchanged in February as the economy is stabilizing with improvements in trade figures, the islands central bank said. “The decision of the Monetary Board is consistent with the objective of maintaining inflation at mid-single digit levels over the medium term and thereby facilitating a sustainable growth trajectory,’ it said in a statement. The Monetary Board also noted that the economy is currently operating at a level below its potential. “Nevertheless, as per the available indicators, the economy is likely to recover from the effects of adverse weather conditions in the past two years and benefit from the expected boost in external demand and foreign direct investment inflows,” “Improvements in the trade front, including the execution of new...
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Sri Lanka Central Bank extends suspension of Perpetual Treasuries for another 6 months
6Jan By Faraz ShauketalyNo Comments
Business

Sri Lanka Central Bank extends suspension of Perpetual Treasuries for another 6 months

The Central Bank of Sri Lanka has extended the suspension of Perpetual Treasuries (PTL) from carrying on business activities as a primary dealer for another six months, the Bank said in a statement today. The Central Bank suspended Perpetual Treasuries from carrying on business activities as a primary dealer on 6th July 2017. "The Monetary Board on 04th January 2018, acting in terms of the Regulations made under the Registered Stock and Securities Ordinance and the Local Treasury Bills Ordinance, has decided to extend the suspension of Perpetual Treasuries Limited (PTL) from carrying on the business and activities of a Primary Dealer for a period of six months," the statement said. The suspension was extended in order to continue the investigations being conducted by the Central B...
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CB takes over ETI Finance, Swarnamahal Financial
3Jan By Faraz ShauketalyNo Comments
Business, Main Story

CB takes over ETI Finance, Swarnamahal Financial

Panel appointed to manage the affairs of both companies Governor says two institutions are illiquid but not insolvent; rules out any systemic risk  Assures both firms can be revived as they have potential Deposit base of ETIF is about Rs. 33.5 b from 33,000 depositors while SFSP exposure is Rs. 2.5 b from 2,300 depositors Negative net worth of ETIF is Rs. 19 b; that of SFS is Rs. 1.2 b By Charumini de Silva With a view to safeguard the interests of the depositors and ensure stability of the financial system, the Central Bank yesterday appointed a new management panel to oversee beleaguered ETI Finance Ltd. (ETIF) and listed Swarnamahal Financial Services Plc (SFSP). “I want to reassure the market as well as depositors in ETIF and SFSP that while there is a problem, it ...
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Sri Lanka maintains policy rates as fiscal sector records notable improvements in 2017
28Dec By Faraz ShauketalyNo Comments
Business

Sri Lanka maintains policy rates as fiscal sector records notable improvements in 2017

Sri Lanka's Central Bank releasing the monetary policy review on Thursday said environment it has decided to maintain current policy interest rates as the fiscal sector recorded notable improvements in 2017, particularly due to increased revenue collection. Accordingly, the Monetary Board has decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank unchanged at 7.25 percent and 8.75 percent, respectively while the Statutory Reserve Ratio remains at 7.50 percent. However, the Central Bank said it will continue to cautiously monitor the developments in the economy and take necessary policy actions, if warranted. Sri Lanka's economy in the third quarter of 2017 grew by 3.3 percent, lower than the projected growth ...
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Central Bank issues CIFL licence cancellation notice
6Dec By Faraz ShauketalyNo Comments
Business

Central Bank issues CIFL licence cancellation notice

The Monetary Board of Central Bank of Sri Lanka issued a notice of cancellation of the licence issued to Central Investments and Finance PLC (CIFL) to carry on activities as a non-banking financial institution. According to a release issued by the Central Bank, CIFL was confronted with severe liquidity crisis since 2013 due to mismanagement and other irregular transactions carried out by the management of that company. It has also been observed that the directors and senior management of these companies have fraudulently inflated the value of the assets and the examination of the documents relating to such assets has revealed that those are either fictitious or entangled with encumbrances. The total deposit liability of the company is about Rs. 3.5 billion and the number of deposi...
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