OVERVIEW OF BANKING INDUSTRY IN SRI LANKA

-


Banking Sector

The banking sector in Sri Lanka, which comprises Licensed Commercial Banks (LCBs) and Licensed Specialized banks (LSBs), dominates the financial system and accounts for the highest share of the total assets in the financial system. Banks play a critical role within the Sri Lankan financial system, as they are engaged in provision of liquidity to the entire economy, while transforming the risk characteristics of assets.

Banks also engaged in providing payment services, thereby facilitating all entities to carry out their financial transactions. On the other hand, banks can create vulnerabilities of systemic nature, partly due to a mismatch in maturity of assets and liabilities and their interconnections. Therefore, the soundness of banks is important, as it contributes towards maintaining confidence in the financial system, and any failure may have the potential to impact on activities of all other financial and non-financial entities, and finally the economy.

In terms of the asset base and the magnitude of services provided, the LCBs are the single most important category of financial institutions within the banking sector. LCBs dominate the financial system with the highest market share of the entire financial system's assets. Therefore, the health of Sri Lankan financial system depends to a large extent on the soundness of the LCBs, primarily on the performance and financial strength of the six largest LCBs, generally referred to as the Systemically Important Banks (SIBs).

The systemic importance of the LSB sector is relatively low in comparison to the LCBs, both in terms of size and their impact on the financial system, as it does not play a major intermediary role in the payment cycle.

Banks are the cornerstone of a national financial system. Their key services are to provide a safe haven for the earnings of individuals and to make loans to companies in need of capital, either to start, operating or to stay in the business. By channeling savings into the business sector through loans and also offering loans to individuals to enhance their lifestyles, banks boost overall economic growth and development.

Licensed Commercial Banks

Nowadays, 26 commercial banks has established in Sri Lanka.

 https://www.cbsl.gov.lk/authorized-financial-institutions/licensed-commercial-banks

1
Amana Bank PLC  
14
Indian Overseas Bank 
2
Axis Bank Ltd 
15
MCB Bank Ltd 
3
Bank of Ceylon 
16
National Development Bank PLC 
4
Bank of China Ltd
17
Nations Trust Bank PLC 
5
Cargills Bank Ltd 
18
Pan Asia Banking Corporation PLC 
6
Citibank, N.A. 
19
People's Bank 
7
Commercial Bank of Ceylon PLC 
20
Public Bank Berhad 
8
Deutsche Bank AG 
21
Sampath Bank PLC 
9
DFCC Bank PLC 
22
Seylan Bank PLC. 
10
Habib Bank Ltd 
23
Standard Chartered Bank 
11
Hatton National Bank PLC 
24
State Bank of India 
12
ICICI Bank Ltd 
25
The Hongkong & Shanghai Banking 
13
Indian Bank 
26
Union Bank of Colombo PLC 

Licensed Specialized Banks

According to the Central Bank of Sri Lanka, There are 7 specialized banks in Sri Lanka.

https://www.cbsl.gov.lk/authorized-financial-institutions/licensed-specialised-banks

1.     Housing Development Finance Corporation Bank of Sri Lanka (HDFC)

2.     Lankaputhra Development Bank Ltd.

3.     National Savings Bank

4.     Pradeshiya Sanwardhana Bank

5.     Sanasa Development Bank PLC

6.     Sri Lanka Savings Bank Ltd

7.     State Mortgage & Investment Bank

Comments

Post a Comment

Popular posts from this blog

MARKETING STRATEGIES USED BY HNB

-
HNB Savings Plus Normally other banks give around maximum 6% interest rate for normal savings accounts for their customers. Although HNB has offered a savings account named HNB SAVINGS PLUS as a general deposit which pays a 7.5% interest rate for the customers. Compared to other commercial banks, it is the bank deposit which pays the highest interest rate for a saving account in the market. HNB is offered many benefits for the customers via the savings plus account. They are, ·          Free Shopping Debit Card ·          Free Internet Banking and Mobile Banking facility ·          Free SMS notifications ·          Unlimited withdrawals ·          Cash backed facilities of up to 90% of the deposit As per the benefits and this attractive interest rate of this savings account, it can be considered as a marketing strategy which is used by HNB to attract customers and to compete with other banks.
Read more

HNB FIT ACCOUNT

-
HNB Fit is an online application that promotes fitness and health among customers while rewarding with increased financial benefits. It will make users’ every step count and get his HNB account credited for each step that keeps every day. HNB Fit which has integrated with top three fitness brands, Apple, Fitbit and Jowbone and that is synced with these smart watches and measures how many steps have taken. Then it will be offered an increased interest for each day, a maximum of 10% for 10,000 steps.
Read more

FINANCIAL SYSTEM IN SRI LANKA

-
Image
A financial system is a system that allows the exchange of funds between lenders and borrowers. Every financial system operates at national and global levels of an economy. They consist of complex and closely related services, markets and institutions intended to provide an efficient and regular linkage between investors and depositors.   The financial system of a country includes various units which relates to the payment system of that country through money transactions. Therefore, financial development of a country depends on the development of the money and money transactions of that country. Components of a Financial System                                                     Functioning of a financial system in a country is reflected by some sections of an economy. Those are, ·          Circulation of Money and Central Bank ·          Financial Instruments and Financial Markets ·          Financial Institutions ·          Payments and Settlements Systems
Read more