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2020-09-30 | Finance Leasing Act Directions No. 6 of 2020

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Amendments to Directions on Liquid Assets

The Central Bank of Sri Lanka issued amendments to the Finance Leasing (Liquid Assets) Direction No. 04 of 2012 for Specialized Leasing Companies (SLCs). The directive mandates SLCs to maintain minimum liquid assets equal to at least five percent of total liabilities and off-balance sheet items, excluding shareholder liabilities, securitizations, and long-term borrowings. Valid for six months until 31 March 2021, the updated requirements aim to alleviate liquidity stress during the ongoing COVID-19 pandemic.

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CENTRAL BANK OF SRI LANKA
30 September 2020 FINANCE LEASING ACT DIRECTIONS No. 06 of 2020

AMENDEMENTS TO DIRECTIONS ON LIQUID ASSETS

In terms of the powers conferred by section 34 of the Finance Leasing Act, No.56 of 2000, the Director of the Department of Supervision of Non-Bank Financial Institutions issues the following amendments to the Finance Leasing (Liquid Assets) Direction No.4 of 2012 issued for Specialized Leasing Companies (SLCs), considering the presently challenging environment due to COVID-19 pandemic.

Accordingly, following will replace the Direction 1 of the Finance Leasing (Liquid Assets) Direction No. 04 of 2012.

1. Minimum holding of liquid assetsEvery SLC shall maintain minimum liquid assets at the close of the business on any day of an amount not less than 5 per cent of the total liabilities and off-balance sheet items excluding liabilities to the shareholders, securitizations and asset backed long term (over one year) borrowings.
2. Validity PeriodThese Directions shall be effective for a period of Six (6) months until 31 March 2021, in order to facilitate the SLCs to overcome stress on liquidity at the present challenging environment

J D S J Nanayakkara
Director, Department of Supervision of Non-Bank Financial Institutions, Central Bank of Sri Lanka

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D Directive No. 4 of 2012D Directive No. 4 of 2012Amendments to Directions onLiquid Assets2020-09-30 · this documentAmendments to Directions on Liquid Assets (2020-09-30)
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Source: Central Bank of Sri Lanka — original document · Summary generated with machine assistance and reviewed before publication; the authoritative text is the regulator's original document. How RegAlert works

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