Regulatory Alerts2020-12-11 | Banking Act Direction No. 11 of 2020Investments in Sri Lanka International Sovereign Bonds by Licensed Commercial Banks and National Savings Bank
The Central Bank of Sri Lanka directs licensed commercial banks and the National Savings Bank to suspend purchases of Sri Lanka International Sovereign Bonds for six months. This suspension applies unless acquisitions are funded by new foreign currency inflows from abroad. Implemented immediately, the directive alleviates exchange rate pressure and financial market stress caused by the Covid-19 outbreak.
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CENTRAL BANK OF SRI LANKA BANK SUPERVISION DEPARTMENT
11 December 2020 | BANKING ACT DIRECTIONS | No. 11 of 2020
INVESTMENTS IN SRI LANKA INTERNATIONAL SOVEREIGN BONDS BY LICENSED COMMERCIAL BANKS AND NATIONAL SAVINGS BANK
Issued in terms of the powers conferred by Sections 46(1) and 76(J)(1) of the Banking Act No. 30 of 1988, as amended.
The Central Bank of Sri Lanka, with a view to easing the pressure on the exchange rate and the stress on financial markets due to the impact of the Covid-19 outbreak, requires the licensed commercial banks and National Savings Bank to suspend the purchase of Sri Lanka International Sovereign Bonds (ISBs) for a period of six months unless such purchase of ISBs is funded by new foreign currency inflows to such licensed banks sourced from abroad.
This Direction shall be implemented with immediate effect.
(Signature)
Prof. W D Lakshman Chairman of the Monetary Board and Governor of the Central Bank of Sri Lanka