News & market updates

The Central Bank of Sri Lanka released key findings of the Systemic Risk Survey for H1 2026 on market participants' perceptions of risks to the financial system; the survey was conducted 19 Dec 2025–16 Jan 2026 in the aftermath of the Ditwah cyclone. Respondents included executives from banks, finance companies, insurance firms, brokers and other financial service providers.

Food inflation in Colombo fell to 0.2% Y-o-Y in February 2026, bringing headline CCPI inflation to 1.6% Y-o-Y and the month-on-month CCPI down 0.85%, driven mainly by lower vegetable and green chilli prices.

Commercial Bank of Ceylon PLC grew its loan book past Rs. 2.028 trillion in 2025 (up Rs. 541bn, +36.37%) and reported a net profit of Rs. 58.49bn for the year, with deposits up and CASA at 39.65%.

Hatton National Bank (HNB) reported group Profit After Tax of Rs. 49.8 billion for 2025, with Gross Loans and Advances exceeding Rs. 1.5 trillion and deposits around Rs. 1.96 trillion. Asset quality strengthened (Net Stage 3 ratio 1.09%) and the board proposed a total dividend of Rs. 20 per share.

Seylan Bank reported a record PAT of Rs. 12.1 billion for the year ended 31 Dec 2025, up 20.5% (PBT Rs. 19.6bn, +22.3%), with total assets up 18% to Rs. 921bn, improved asset quality (Stage 3 ratio 1.03%) and CET1 of 12.39%.

Public Debt Management Office raised the full Rs. 140 billion offered across three tenors at weighted average yields of 9.50% (01.03.30), 10.70% (15.06.34) and 10.88% (01.07.37), below or in line with market expectations. Secondary bond market rallied, liquidity was elevated at Rs. 341.02 billion and USD/LKR closed ~309.29/309.32.

Commercial Bank of Ceylon (COMB) grew gross loans to Rs.2.028 Tn—becoming the first private sector bank above Rs.2 Tn—after Rs.541 Bn loan growth in 2025 and reported net profit of Rs.58.49 Bn (up 44.05% vs normalised 2024).

Seylan Bank reported a record Profit After Tax of LKR 12.1 Bn for the year ended 31 Dec 2025, up 20.5% (PBT LKR 19.6 Bn, +22.3%). Total assets rose to LKR 921 Bn, CET1 12.39% and total capital ratio 17.89%; the bank raised LKR 15 Bn in Basel III Tier-2 debentures and received a Fitch upgrade to A+(lka).

HNB PLC reported Group profit after tax of Rs 49.8 Bn for 2025 and proposed a total dividend of Rs 20.00 per share. Group gross loans topped Rs 1.5 Tn, deposits reached Rs 1.96 Tn, Net Stage 3 ratio improved to 1.09%, and net fee income rose 28.9%.

National Development Bank PLC reported FY2025 profit after tax of LKR 11.0bn, an all-time high (LKR 9.0bn in 2024) and doubled on a normalised basis excluding 2024 ISB one-offs. Net loans and deposits expanded ~26.7% and 10.4% (normalised), ROE improved to 13.5% and EPS was LKR 25.90.

Hayleys PLC said its board has resolved to raise up to Rs. 7 billion via a listed debenture issue (50 million debentures with an option for 20 million more at Rs.100 par). Details on tenure, interest rates and other terms will be announced and the issue is subject to regulatory approvals.

Global debt hit a record $348 trillion at end-2025, rising by nearly $29 trillion over the year as governments added more than $10 trillion, the IIF said. The shift toward sovereign borrowing raised government debt to about $106.7tn, left emerging markets with large 2026 rollover needs, and heightens interest-rate and funding risks.

Net liquidity surplus rose to Rs. 322.93 billion (highest in 22 years) as the CB drained liquidity via repos; weekly T‑Bill yields fell for a sixth straight week and a Rs. 140 billion Treasury Bond auction across three maturities is scheduled (settlement 3 Mar 2026).

DFCC Bank reported record results for the year ended 31 Dec 2025: Group core business PAT of LKR 11.2 Bn and Bank PAT of LKR 16.03 Bn including a disposal gain. Total assets rose 22% to LKR 857 Bn and the loan book grew to LKR 516 Bn.

Asia markets rose (MSCI Asia-Pacific ex-Japan ~+1%), led by Korean chipmakers as AI sentiment improved; investors also watched the yen and BOJ/Fed rate outlook. Traders awaited the US State of the Union while oil gained ~0.75% and gold was flat.

Economist Talal Rafi urged a disciplined shift from stabilisation to growth, calling for trade and productivity-driven reforms alongside fiscal discipline and reserve accumulation. He noted debt-to-GDP has fallen to near 100%, IMF growth at ~2.9% (this year)/3.1% (next) and reserves projected to rise to ~$8.8bn by year-end.

Secondary bond market rates edged up as participants awaited a Rs.90 billion Treasury Bill auction and a Rs.140 billion Treasury Bond auction this week. Selected government bond yields rose across tenors, money-market liquidity showed a surplus of Rs.297.94 billion, and USD/LKR was around 309.35/309.40.

Commercial Bank of Ceylon's Chief Risk Officer Kapila Hettihamu says the bank maintains a disciplined, conservative risk management approach that has supported resilience, improved asset quality and strong portfolio growth. He cites use of analytics, stress testing and governance to manage credit, tech and ESG risks.

Capital Alliance PLC’s affiliate Capital Alliance Investments Ltd listed 841,263,375 units of the CAL Three Year Closed End Fund on the Colombo Stock Exchange. The three-year fixed-income fund aims to offer predictable cash flows and credit-monitored exposure amid a stabilizing yield environment.

Secondary bond market opened with rates edging up and trading dull ahead of T-bill/Bond auctions and February CCPI; selected tenors traded between 9.00% (15.02.28) and 10.84% (15.06.35). Net liquidity surplus was Rs.288.48bn; CB drained Rs.50bn via overnight repo at 7.62%; USD/LKR ~309.36.

Asian stocks slipped after a Wall Street selloff driven by uncertainty over U.S. tariff policy and AI-related risks; MSCI's Asia-Pacific ex-Japan index was down about 0.2%.

Spot gold fell 1.5% to $5,150.38 per ounce after hitting a more-than-three-week high, as a firmer dollar outweighed support from U.S. tariff uncertainty and Washington‑Tehran tensions.

Capital Alliance Investments Ltd (a CAL Group subsidiary) listed 841,263,375 units of the CAL Three Year Closed End Fund on the Colombo Stock Exchange. The three-year closed-end fixed-income unit trust targets predictable cash flows and capital preservation amid a stabilizing yield environment.

Sri Lanka's National Consumer Price Index inflation fell to 2.4% in January 2026 from 2.9% in December 2025. Food inflation eased to 3.4% (from 4.4%) while non-food inflation remained unchanged at 1.6%.

Wall Street futures and the dollar fell after confusion over new U.S. tariffs — including a surprise shift to a 15% global rate — revived 'sell America' flows. Nvidia's upcoming results will test the AI sector, while gold rose, oil eased and Treasury moves raised concerns about a roughly $170bn revenue hit that could widen the fiscal deficit.

Secondary bond-market yields edged higher last week, driven by profit-taking, with medium–long tenors rising (e.g. 01.10.32 to 10.25%, long end up to 10.92%). The weekly T-bill auction was fully subscribed raising Rs.66.00bn while the 91-day yield fell to 7.66%; USD/LKR closed ~309.40.

CFA Society Sri Lanka, the SEC and the CSE publish 'Understanding Fixed Income', explaining that bonds provide regular interest and principal repayment but are affected by interest-rate, inflation and credit risks. The article outlines Sri Lankan government and corporate bonds, coupons, maturities, liquidity and credit ratings.

Sampath Group posted record 2025 results with group PBT of Rs. 53.0bn, PAT of Rs. 32.6bn and total assets surpassing Rs. 2.0tn. Sampath Bank reported PBT of Rs. 49.3bn, PAT of Rs. 30.2bn, declared a Rs. 10.30 per share final dividend and saw gross loans rise 27% to Rs. 1.2tn.

Sampath Bank reported record bank-level PBT of Rs 49.3 Bn and PAT of Rs 30.2 Bn for the year ended 31 Dec 2025, with gross loans up 27% to Rs 1.2 Tn and a first and final cash dividend of Rs 10.30 per share. NII and NIM declined amid lower rates, while Tier 1 and total CAR were 14.75% and 17.65%.

Asian stocks slipped and oil climbed as a U.S. military buildup around Iran pushed Brent crude above $72/bl; the dollar posted its biggest weekly gain in four months after mixed U.S. data and Fed minutes.