News & market updates

Private sector credit rose Rs.238.1bn M-o-M to Rs.11.04tn in May (2.2% M-o-M, 27.8% YoY). The CBSL raised the OPR by 100bps to 8.75% in late May to curb credit-driven import demand amid sharp rupee depreciation.

Workers' remittances rose 9.3% YoY to $695m in June, lifting January–June inflows 23.2% YoY to over $4.6bn — the strongest first half on record, bolstering Sri Lanka's foreign-exchange position amid weak exports and tourism.

Sri Lanka's official reserves fell 6.9% (US$431m) to US$6.45bn in June. CBSL estimates short-term FX outflows of US$2.15bn and short positions of US$4.04bn; IMF cut the end-2026 NIR target to US$778m and CBSL is expected to buy dollars, implying continued rupee depreciation pressure.

Senkadagala Finance PLC reported a record group profit after tax of Rs. 2.05 billion for FY2025/26 (up 16% YoY); total assets rose 40% to Rs. 57.07 billion and total capital adequacy stood at 23.84% after a Rs. 1.035 billion rights issue.

Foreign portfolio inflows into rupee-denominated government securities totalled Rs 32.04 billion for the week ending 9 July—the largest weekly inflow since Feb 2013—raising foreign holdings to Rs 168.90 billion. Secondary bond yields re-priced higher mid-week amid rising oil prices and geopolitical risk, T-Bill auction yields broadly steady, and the rupee weakened to ~Rs 335.8; a Rs 150 billion Treasury Bond auction across three maturities is scheduled on 15 July.

Merchant Bank of Sri Lanka & Finance PLC (MBSL) appointed veteran banker Russel Fonseka as Chief Executive Officer. Fonseka brings 30+ years' banking experience and was General Manager/CEO of Bank of Ceylon until August 2025.

DFCC Bank PLC has signed an MoU with Co-Energi to provide customers with energy audits, technical advisory and tailored sustainable financing for energy-efficiency projects. The partnership aims to help businesses lower operating costs and boost long-term resilience.

DFCC Bank held its annual Buddhanuwandana Poson Bhakthi Gee observances in Colombo and Kandy, livestreaming the programmes and hosting a Dansala at Kandy's Sri Dalada Maligawa to engage employees, customers and the public.

Visa hosted the Sri Lanka Cybersecurity Conclave on 25 June 2026, convening banks, government and regulators to address AI-driven cyber threats, fraud prevention and Visa's security solutions. Participants stressed threat intelligence, real-time response and information sharing.

Colombo Stock Exchange's ASPI fell 0.40% (86.60 pts) to 21,678.96 and the S&P SL20 dropped 0.33% to 6,057.66, with market turnover Rs194.1m as banks weighed on the index. Alpha Fire Services announced a proposed acquisition of Icon Engineering, projecting group revenue above Rs1bn, ~30% higher profitability and foreign currency inflows from Maldives projects.

AmCham Sri Lanka led a delegation to the AmChams of Asia Pacific Washington Doorknock (21–24 June 2026) to lobby US policymakers on the US–Sri Lanka bilateral trade agreement, Section 301 issues affecting exporters (notably apparel), and to seek US investment and development finance support.

Hatton National Bank (HNB.N0000) has been named Title Sponsor of the Ceylon Chamber of Women Entrepreneurs Fashion Week & International Summit 2026, to be held 16–20 July at Cinnamon Life, Colombo. HNB says the sponsorship supports women's entrepreneurship, SME development and financial inclusion.

Foreign holdings in Sri Lanka rupee bonds rose by a net US$97.1m in the week to July 9, lifting foreign holdings to Rs168,895m — the highest since Aug 10, 2023. The inflow coincided with the rupee recovering to about 330/USD and a 100bp May policy rate hike by the Central Bank.

Sri Lanka's foreign reserves fell 6.2% to US$6,450m at end-June 2026. The central bank net-bought US$70.5m in June and US$556.4m in H1 2026, but the decline could pressure IMF reserve targets and future disbursements.

ADB lowers developing Asia and Pacific growth to 4.9% for 2026 (from 5.5% in 2025), a 0.2 percentage point downgrade from April due to prolonged energy-market disruptions. It raises regional inflation to 4.3% for this year and warns of risks from tighter financial conditions, supply-chain strains and higher fertilizer/commodity costs.

ADB retains Sri Lanka's 2026 GDP growth forecast at 4%, lowers 2027 to 4.0% from 4.2% citing the recent 100 basis-point rate hike, and raises 2026 inflation to 6% due to domestic fuel price rises and electricity tariff increases.

Government will implement a phased, FATF-aligned AML regulatory framework for virtual asset service providers and has proposed the SEC as prudential regulator, while cryptocurrencies remain unrecognised and banks/cards are barred from facilitating crypto transactions. Talks to enable PayPal inward receipts continue and some banks already offer Wise/Payoneer for cross-border receipts.

PMF Finance PLC has withdrawn its proposed listed, rated, unsecured senior redeemable debenture issue of up to Rs. 1 billion after a board decision following an internal assessment; the company gave no further details.

Sri Lanka sold Rs10,000 million of treasury bills on tap at average rates of 10.21% and 10.30%, bringing total bills sold this week to Rs110,000 million; market subscription was Rs46,180 million. The sales included 3-, 6- and 12-month bills (3- and 12-month at 10.21%, 6-month at 10.30%).

CSE ended an eight-session slide as the ASPI rose 0.31% to 21,765.56 and the S&P SL20 gained 0.25% to 6,081.43. Turnover topped Rs.2bn with foreign net outflows of Rs.673mn; top contributors included Ceylon Cold Stores, Haycarb, John Keells and RIL, while banks (Commercial Bank, Sampath) led turnover.

Media Fest 2026, Sri Lanka's full-day media industry gathering, kicks off today at the Taj Samudra, Colombo focusing on 'Staying Relevant in a Changing World' and digital transformation. Sponsors include Commercial Bank PLC, Mahindra Ideal Finance, SriLankan Airlines and Taj Samudra.

Sri Lanka's rupee closed at 335.70/90 to the US dollar, slightly stronger than 336.00/60 the prior day, while government bond yields were largely flat. Yields across quoted maturities ranged around 10.30–11.80% with little change on the day.

Nations Trust Bank (NTB.N0000) appointed Ananda Jayawardana as an Independent Non-Executive Director; he brings 25+ years' experience in leveraged & structured finance, debt capital markets and corporate banking.

Sampath Bank's proposed LKR10 billion Basel III-compliant subordinated green bonds were assigned a final National Long-Term Rating of 'A(lka)' by Fitch. The five- and seven-year bonds, to be listed on the CSE, will bolster Tier-2 capital and finance/refinance green projects and include a non-viability conversion clause.

Union Bank CEO Dilshan Rodrigo said SMEs are understating revenues and profits—banks often reconstruct financials and find turnover about 40% higher—hindering cash-flow lending. He urged stronger audit standards, independent SME credit ratings and deeper capital markets for long-term SME finance.

Secondary government bond yields rose and the Finance Ministry announced a Rs.150 billion Treasury bond auction across three maturities (Rs.70bn 15 Oct 2030; Rs.50bn 15 Oct 2034; Rs.30bn 1 Jul 2037). Market liquidity increased to Rs.139.01bn and USD/LKR closed at 336.00/336.40.

A seminar on Beneficial Ownership compliance will be held on 22 July 2026 at The Kingsbury, Colombo to provide guidance on BO filings under the Companies Act No. 12 of 2025 and CBSL Direction 2 of 2026, highlighting the statutory BO filing deadline of 30 September 2026 and non-compliance risks.

Nations Trust Bank (NTB.N0000) appointed Ananda Jayawardana as an Independent Non-Executive Director. He brings over 25 years' experience in leveraged and structured finance across Asia, with senior roles at Standard Chartered and the Royal Bank of Scotland.