Regulatory Alerts2017-01-16 | Finance Leasing Act Direction No. 1 of 2017Loan to Value Ratio for Credit Facilities in Respect of Motor Vehicles
The Central Bank of Sri Lanka issued Direction No. 01 of 2017 to impose maximum Loan to Value ratios on credit facilities granted by Specialized Leasing Companies for motor vehicles. Effective 16 January 2017, the directive sets specific LTV caps ranging from 25 percent for three-wheelers to 90 percent for commercial vehicles, with a uniform 70 percent limit for vehicles registered for over one year. The regulation also grants exemptions for tourism and transportation companies acquiring vehicle fleets for core operations, provided the assets are not transferred within one year.
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