Central Bank revises ownership limits in licensed commercial banks

The Central Bank (CB) has revised ownership limits in licensed commercial banks for Multilateral Financial Organisations as approved by the Monetary Board.
This decision has been taken by considering the benefits to the banking system through the investments by Multilateral Financial Organisations in the shareholding of licensed specialised banks, a directive issued by CB Governor Prof. W.D. Lakshman revealed.        
As per the new directive, the new maximum percentage of ownership of shares is 20 per cent for these financial organisations. Earlier it was confined to 15 per cent. 
The 20 per cent maximum limit for Multilateral Financial Organisations (MFOs) such as the World Bank, International Finance Corporation (IFC), Asian Development Bank (ADB) and any other similar institutions has been approved by the Monetary Board of the CB 
It is subject to the condition that the material interest so acquired has to be reduced to 15 per cent within a period of 10 years from the date of stipulation. 
The move follows the Monetary Board having considered the benefits to the banking system through the investments by multilateral financial organisations in the shareholding of licensed commercial banks. (Bandula)