Regulatory Alerts2021-04-09 | Finance Business Act Directions No.04 of 2021Foreign Currency Borrowings by Licensed Finance Companies
The Monetary Board of the Central Bank of Sri Lanka issued Directions No. 04 of 2021 to regulate foreign currency borrowings by Licensed Finance Companies and mitigate financial sector volatility. The directions impose a minimum two-year maturity for such borrowings and establish tiered limits based on total assets, ranging from 10% to 20% depending on prudential criteria and approval levels. Licensed Finance Companies must secure board approval, adhere to strict hedging requirements using currency swaps, and comply with specific notification or prior approval procedures for the Director or Monetary Board.
Share