The State of Banking in Sri Lanka

Sri Lanka's banking sector has undergone significant changes in recent years, with the government's efforts to promote financial inclusion and stability.

The country has a relatively high bank penetration rate, with over 95% of the population having access to banking services.

Banks in Sri Lanka are primarily state-owned, with the Central Bank of Sri Lanka (CBSL) being the regulator and supervisor of the sector.

The CBSL has implemented various policies to strengthen the banking sector, including the requirement for banks to maintain a minimum capital adequacy ratio of 10%.

Sri Lanka has a diverse range of banks, including commercial banks, development banks, and specialized banks that cater to specific industries such as agriculture and microfinance.

Banking in Sri Lanka has a rich history that spans over two centuries. The first bank in Sri Lanka was the Bank of Ceylon, established in 1818 by the British colonial government.

The Bank of Ceylon was initially established as a branch of the Bank of Bengal, but it soon became an independent entity. It was the first bank in the country to provide banking services to the public.

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The bank's early years were marked by a significant increase in its operations, with the establishment of several branches across the country. By the mid-19th century, the Bank of Ceylon had become a major financial institution in Sri Lanka.

The bank's growth was further accelerated by the introduction of new banking services, such as the issuance of banknotes and cheques. This made it easier for people to conduct financial transactions and manage their finances.

The Bank of Ceylon continued to play a vital role in the development of Sri Lanka's banking sector, and it remains one of the largest and most respected banks in the country today.

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The banking sector in Sri Lanka is dominated by Licensed Commercial Banks (LCBs) and Licensed Specialised banks (LSBs). These banks play a critical role in providing liquidity to the entire economy and transforming the risk characteristics of assets.

Banks in Sri Lanka are responsible for providing payment services, which facilitates all entities to carry out their financial transactions. This is a crucial function that keeps the economy running smoothly.

LCBs, in particular, dominate the financial system with the highest market share of the entire financial system's assets. They are the single most important category of financial institutions within the banking sector.

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The banking sector in Sri Lanka is dominated by Licensed Commercial Banks (LCBs) and Licensed Specialised banks (LSBs), with LCBs holding the highest share of total assets in the financial system.

Banks play a critical role in providing liquidity to the entire economy, transforming risk characteristics of assets, and facilitating financial transactions for all entities.

LCBs are the single most important category of financial institutions within the banking sector, dominating the financial system with the highest market share of assets.

The health of Sri Lanka's financial system depends heavily on the soundness of LCBs, primarily the performance and financial strength of the six largest LCBs, known as Systemically Important Banks (SIBs).

The LSB sector has a relatively low systemic importance compared to LCBs, both in terms of size and impact on the financial system.

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Indian Overseas Bank has a presence in Sri Lanka, with its Main Branch located at 139, Main Street, Colombo – 11.

You can reach the bank's Main Branch in Colombo by phone at +94 112 320515.

The bank's fax number is +94 112 447900.

If you need to send a telegraph, the bank's telex number is 21515 IOBEE CE.

For international transactions, the bank's SWIFT code is IOBALKLC.

You can also contact the bank via email at [email protected].

The bank's website is www.iob.in/colombo.aspx.

In Sri Lanka, you can choose from various types of banking that suit your needs.

Commercial banks, such as Commercial Bank of Ceylon and Bank of Ceylon, offer a wide range of financial services to individuals and businesses.

Savings banks, on the other hand, focus on providing low-cost deposits and loans to their customers.

The People's Bank, for instance, is a state-owned savings bank that has been serving Sri Lankans since 1961.

Cooperative banks are member-owned and operated, with the goal of promoting financial inclusion and social welfare.

The Cooperative Central Bank of Sri Lanka is the apex body that regulates and supervises these cooperative banks.

Islamic banks, like the Bank of Ceylon's Islamic Banking Unit, operate under Shariah principles and do not charge interest.

The Central Bank of Sri Lanka regulates and supervises all types of banks operating in the country.

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Sri Lankan banks are required to maintain a minimum capital adequacy ratio of 12% to ensure stability in the financial sector. This regulation is set by the Central Bank of Sri Lanka to safeguard the country's banking system.

The banking system in Sri Lanka is dominated by state-owned banks, with the Commercial Bank of Ceylon being the largest bank in the country. This dominance has led to concerns about the lack of competition in the sector.

The Central Bank of Sri Lanka has implemented various measures to promote digital banking and reduce the country's reliance on cash transactions. One such measure is the introduction of mobile payment services.

Sri Lankan banks offer a range of services, including savings accounts, current accounts, and credit facilities. However, the high interest rates and strict lending criteria can make it difficult for small businesses and individuals to access credit.

The country's banking sector has grown significantly over the past decade, with the total assets of commercial banks increasing from Rs. 2.4 trillion in 2010 to Rs. 6.3 trillion in 2020.

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In Sri Lanka, education is highly valued and considered essential for economic growth and development. The country has made significant progress in increasing access to education, with a literacy rate of over 92%.

The government has implemented policies to improve the quality of education, including the introduction of a free education policy for all children. This policy has helped to increase enrollment rates, especially among disadvantaged groups.

The curriculum in Sri Lankan schools focuses on developing key skills in areas such as mathematics, science, and language. Students also have the opportunity to pursue vocational training in fields like agriculture and technology.

Sri Lanka has a strong tradition of higher education, with several reputable universities offering a wide range of academic programs. The University of Colombo, for example, is one of the oldest and most prestigious universities in the country.