By Newswire Editorial
Credit extended to Sri Lanka’s private sector increased to Rs. 2.1 trillion during the first nine months of 2026, compared to Rs. 1.9 trillion during the corresponding period in 2025, according to the Central Bank of Sri Lanka.
The figures were presented during a recent meeting of the Committee on Public Finance (COPF), chaired by MP Harsha de Silva, with the participation of Central Bank Governor Nandalal Weerasinghe and other senior officials.
Central Bank officials informed the Committee that approximately 74% of private sector credit during the period had been provided by licensed commercial banks.
However, the Committee raised concerns over changes in lending patterns, noting that the share of short-term loans had increased from 42% to 47%, while the share of long-term loans had declined from 35% to 29%.
Members questioned whether bank lending was being adequately directed towards capital formation, new investments and the expansion of production capacity.
The Committee also sought clarification on the growth of different lending categories, including housing mortgage loans and vehicle loans.
Discussions further focused on Sri Lanka’s long-term economic growth potential, with emphasis placed on the need for reforms in the trade, labour and land sectors to support sustainable economic expansion.
The importance of developing human capital, improving productivity and attracting foreign direct investment was also highlighted.
Meanwhile, Central Bank officials reported an improvement in banking sector stability, revealing that the Stage 3 non-performing loan ratio had declined from 9.7% to 8.8%.
They further confirmed that capital and liquidity levels in the banking system remained above the required regulatory thresholds. (Newswire)