Press briefing of Cabinet Decision taken on 2022-11-21

Proposed Banking (Special Provisions) Act

- The Central Bank of Sri Lanka has identified the need to strengthen the bank resolution framework under the crisis management framework of financial institutions regulated by the Central Bank of Sri Lanka as an urgent and priority task. The International Monetary Fund and the World Bank have also indicated the need to strengthen the resolution framework to strengthen financial sector safety nets. In view of the difficulty of enacting a comprehensive new banking law within a short period of time, it has been decided to introduce the proposed Banking (Special Provisions) Act as a supplement to the Banking Act No.30 of 1988 by incorporating provisions for resolution of licensed banks, deposit insurance and safe closure/liquidation of accounts of licensed banks. Accordingly, a preliminary draft has been prepared by the Central Bank of Sri Lanka, and the proposal made by the Hon. President in his capacity as the Minister of Finance, Economic Stabilization and National Policy to instruct the Legal Draftsman to draft a new Bill based on the said preliminary draft, was approved by the Cabinet.