Regulatory Alerts2021-02-17 | Finance Business Act Directions No.02 of 2021Amendments to Directions on Loan to Value Ratios for Credit Facilities Granted in Respect of Motor Vehicles
The Central Bank of Sri Lanka issued Finance Business Act Directions No. 02 of 2021 to amend loan-to-value ratios for motor vehicle credit facilities granted by Licensed Finance Companies. These directions replace specific provisions in the previous 2020 amendments to establish an 80 percent loan-to-value ratio for registered vehicles used in Sri Lanka for more than one year. The directive was signed by Governor Prof. W D Lakshman under Section 12 of the Finance Business Act, No. 42 of 2011.
MONETARY BOARD CENTRAL BANK OF SRI LANKA 17 February 2021 FINANCE BUSINESS ACT DIRECTIONS No. 02 of 2021 AMENDMENTS TO DIRECTIONS ON LOAN TO VALUE RATIOS FOR CREDIT FACILITIES GRANTED IN RESPECT OF MOTOR VEHICLES
Issued under Section 12 of the Finance Business Act, No.42 of 2011.
The Central Bank of Sri Lanka issues Directions as follows for implementation of loan to value ratios in respect of credit facilities granted by Licensed Finance Companies (LFCs), for the purpose of purchase or utilisation of motor vehicles.
- The following will replace Directions 1 (i) (b) of the Finance Business Act Directions No.03 of 2020 on Amendments to Directions on Loan to Value Ratios for Credit Facilities Granted in respect of Motor Vehicles.
"(b) 80 per cent in respect of registered vehicles which have been used in Sri Lanka for more than one year after the first registration."
Signature
Prof. W D Lakshman Chairman of the Monetary Board and Governor of the Central Bank of Sri Lanka