Regulatory Alerts2020-09-08 | Banking Act Direction No. 9 of 2020Amendment to Banking Act Directions on Ownership of Issued Capital Carrying Voting Rights for Licensed Specialised Banks
The Monetary Board of the Central Bank of Sri Lanka issued Banking Act Directions No. 09 of 2020 to amend ownership limits for licensed specialised banks. The amendment permits Multilateral Financial Organisations, including the World Bank and Asian Development Bank, to acquire up to 20 percent of issued capital carrying voting rights on a case-by-case basis. Acquired interests must subsequently be reduced to 15 percent within ten years of approval, subject to terms deemed appropriate by the Monetary Board.
ffi .,'ffJ'Iffi",I:fl,o** $K September 2020 BANKING ACT DIRECTIONS No. 09 of 2020 AMENDMENT TO THE BANKING ACT DIRECTIONS ON OWNERSHIP OF ISSUED CAPITAL CARRYING VOTING RIGIITS FOR LICENSED SPECIALISED BANKS In the exercise of the powers conferred by Section 761(l) of the Banking Act No. 30 of 1988, as amended, the Monetary Board, having considered the benefits to the banking system through the investments by Multilateral Financial Organisations in the shareholding of licensed specialised banks hereby issues the following Direction amending the Banking Act Directions No. 2 of 2007 dated 19 Jantary 2007. The following new Direction will be Directions No. 2 of 2007 . 3. Maximum percentage of ownership of shares inserted immediately after Dirrgction 3(2) of the Banking Act (3) Notwithstanding (1) above, the Monetary Board, subject to terms and conditions it may deem fit, may grant permission on a case-by-case basis to acquire a material interest not exceeding 20 per cent of the issued capttal carrying voting rights in a licensed specialised bank by Multil ateralFinancial Organisations such as the World Bank, International Finance Corporation (IFC), Asian Development Bank (ADB) and any other Multilateral Financial Organisation as approved by the Monetary Board of the Central Bank of Sri Lanka subject to the condition that the material interest so acquired shall be reduced to 15 per cent within a period of 10 years from the date of stipulation. Chairman of the Monetary Board and Governor of the Central Eiank of Sri Lanka Prof. W D Lakshman