Friday Dec 13, 2024
Friday Dec 13, 2024
Friday, 25 November 2022 00:00 - - {{hitsCtrl.values.hits}}
 |
| Central Bank Deputy Governor Yvette Fernando
|
Central Bank Deputy Governor Yvette Fernando yesterday said nine banks that have been identified as having asset quality stress will be reviewed soon.
“It is (asset quality review) yet to start. We are in the final stage of appointing reviewers,” she said in response to a query posed by journalists at the post-Monetary Policy Review Meeting yesterday.
In February, Fitch Ratings warned that Sri Lanka’s banks are likely to face continued asset-quality pressure in 2022, as rising macroeconomic stresses stemming from the sovereign credit profile pose a threat to borrowers’ repayment capacity, alongside the conclusion of most relief measures in 2021.
“We believe Sri Lankan banks face added asset-quality pressure from their Government securities holdings, particularly those denominated in foreign currency which accounted for around 6.5% of Fitch-rated banks’ total assets at end-9M21,” the rating agency noted.
The Deputy Governor also said the review of the banks will be conducted in a phased manner. “We will review six banks in the first phase and another three banks thereafter,” Fernando added.
In April, Fitch Ratings again placed the National Long-Term Ratings of 13 Sri Lankan banks on Rating Watch Negative (RWN).
The banks include; People’s Bank, Commercial Bank of Ceylon PLC, Hatton National Bank PLC, Sampath Bank PLC, National Development Bank PLC, DFCC Bank PLC, Seylan Bank PLC, Nations Trust Bank PLC, Pan Asia Banking Corporation PLC, Union Bank of Colombo PLC, Amana Bank PLC, SANASA Development Bank PLC and Housing Development Finance Corporation Bank of Sri Lanka.
