The economic downturn in 1Q 2023 hit badly the banking sector as the NPL ratio has elevated to 12.9% from the 4Q 2022 11.5%. The moratorium offered during the pandemic era ends n Jan 2023 and many sectors are still struggling which has put banks in trouble. According analysts Banking Sector NPL's are currently in excess of 18% and expected to rise to 40% if no action taken by the banks or Central Bank of Sri Lanka (CBSL) to restructure bad and irrecoverable debts and loans owed to small to medium enterprises.
Above table also indicate the future Capital requirement of Sri Lanka Banks in the event of write off of 10% Non Performing Loans (NPL’s).
Last edited by God Father on Sat Aug 12, 2023 1:48 pm; edited 2 times in total