Central Bank lends Rs 90 b to Govt. to settle loans

The Central Bank (CB) has subscribed to Treasury bills (T-bills) amounting to Rs. 90 billion so far this month (January) at the request of the Treasury to assist financing needs of the government, it was announced on Thursday.

The CB said this was due to the delay in receiving expected foreign currency financing arrangements as envisaged in the Treasury’s cash flow for the month of January. 

“The Monetary Board has acceded to the Treasury’s request in the national interest and under exceptional circumstances. Having reviewed the macroeconomic consequences of subscribing to T-bills by the CB, the Government has agreed to reverse part of the transaction in February and the balance during the first quarter of 2019 once the Government's borrowing programme is brought back on track with realisation of expected financial arrangements,” the CB statement said.

On Tuesday, non-Cabinet Minister of Economic Reforms and Public Distribution Minister Harsha de Silva was quoted in local media as saying that the government had on January 15 settled the US$1 billion borrowed by the previous regime in January, 2014 by way of international sovereign bonds. – Ends -