Banking

Improving economic growth, an increasingly sophisticated domestic market and regulatory reform are the main factors shaping the Sri Lankan banking sector. Stability has become a watchword following a period of rapid credit growth, as a flourishing private sector boosted the development of a previously underbanked market. Although the sector has a healthy growth outlook, the central bank is keen to keep a lid on credit expansion, while higher regulatory standards may trigger long-awaited consolidation. Sound monetary policymaking has helped rein in credit growth to an extent, though respectable economic growth and increasing demand from small and medium-sized enterprises will ensure the rate remains in the double-digits for the coming years. This chapter contains an interview with Indrajit Coomaraswamy, Governor, Central Bank of Sri Lanka.