Central Bank to keep ‘adventurous types’ out

The Central Bank says it’s not interested in any more Indian or Pakistani banks but is keen to attract banks from Singapore, Japan and China.“There are some banks from both India and Pakistan that are seeking approval, but the Central Bank is not keen on any more banks from these countries,” a senior Central Bank source told The Sunday Times FT.

He said that instead, the regulator is willing to lend an ear to proposals from Singapore, Japan and China who want to set up banks in Sri Lanka. Currently there are two Indian banks and one Pakistan bank awaiting approval. “Our vision envisages consolidation and establishment of a strong commercial banking sector in the country,” he pointed out, adding, “We are looking for banking sector investment from other parts of fast developing countries and keep the adventurous types out of the way.”

He explained that the regulator has increased the minimum capital requirement to US$ 25 million which will still rise to US$ 50 million by 2010, due to the regulator focusing on consolidation in the local banking industry and deterring the ‘unwanted’ banks.

Currently Sri Lanka has four Indian banks (Indian Bank, Indian Overseas Bank, State Bank of India and ICICI Bank and three Pakistani banks (Habib Bank, MCB Bank Limited and Standard Chartered Bank of Pakistan).