Regulatory Alerts2020-12-31 | Banking Act Direction No. 13 of 2020Amendments to the Regulatory Framework on Valuation of Immovable Properties of Licensed Commercial and Specialised Banks
The Monetary Board of the Central Bank of Sri Lanka issued Banking Act Directions No. 13 of 2020 to amend the regulatory framework governing how licensed commercial and specialised banks value immovable property collateral. The updated directions mandate strict eligibility criteria and continuous professional development for panel valuers, establish clear financial thresholds distinguishing internal from external valuation reports based on loan performance, and specify valuation frequencies ranging from four to five years depending on property type. Furthermore, the amendments permit banks to recognize revaluation gains in Tier 2 capital once every three years while formally revoking prior valuation directives.
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