Tuesday Mar 03, 2026
Tuesday Mar 03, 2026
Tuesday, 3 March 2026 06:34 - - {{hitsCtrl.values.hits}}
Market participants’ confidence in Sri Lanka’s financial system remained positive over the next 12 months, but declined over the medium term, according to the Central Bank of Sri Lanka’s (CBSL) latest Systemic Risk Survey for the first half of 2026.
The survey was conducted prior to the US Supreme Court’s decision on the Trump administration’s tariff policy and its aftermath. The survey results were released just as the US and Israel launched strikes on Iran which plunged the global economy into uncertainty with oil prices spiking and major airline hubs in the GCC region shutting down.
The survey, conducted between 19 December 2025 and 16 January 2026 with the participation of 147 firms, indicated that short-term confidence (over the next one year) remained positive, while medium-term confidence (over the next three years) declined, possibly shaped by uncertainties related to natural hazards and geopolitical tensions that prevailed during the survey period.
At the same time, the perceived probability of a high-impact negative event showed an uptick in both the short and medium term among respondents.
The Central Bank noted that perceptions were broadly dispersed across multiple risk categories, indicating the absence of a single dominant source of risk to the financial system.
The classification of risks covered seven major categories with 46 sub-risks: global macroeconomic risks; fiscal and sovereign related risks; general domestic macroeconomic risks; risks related to financial infrastructure; financial market risks; risks related to financial institutions; and general risks.
The previous risk category of ‘domestic macroeconomic risks’ was re-classified into two distinct categories, ‘fiscal and sovereign related risks’ and ‘general domestic macroeconomic risks’, starting from the second half of 2025, with three new sub-risks introduced within these categories.
The survey is conducted biannually by the Macroprudential Surveillance Department and has been in place since the first half of 2017. It is used by the Central Bank to monitor perceptions of market participants regarding risks to, and their confidence in, the Sri Lankan financial system.
The updated survey sample includes risk officers of Licensed Banks, licensed Finance Companies, a Specialised Leasing Company, Insurance Companies, Unit Trust Managing Companies, margin providers and underwriters, stock brokerage firms, licensed microfinance companies, rating agencies, financial infrastructure providers and mobile money service providers.
The Central Bank said that the results are based on the perceptions of respondents during the survey period and do not necessarily reflect the views of the Central Bank of Sri Lanka.
