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| Friday, 24 October 2003 |
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CB Governor outlines criteria for Lanka as financial hub Governor of the Central Bank of Sri Lanka A.S. Jayawardena on Wednesday outlined eight major criteria to fullfil for Sri Lanka to attain the much hyped states of regional financial hub. Addressing the financial community at the bi-monthly seminar of the Economic Association of Sri Lanka at Hotel Taj Samudra, Governor Jayawardena said that the eight criteria which had to be fullfilled for this cherished goal were stable political conditions, durable peace, advance legal system, economic stability, human resource development of personnel in the financial sector and regulatory system in which investors have confidence in. Sri Lanka's financial sector is very advanced in the region but these are some of the conditions which have to be met if we are going to be a fully fledged financial hub, he said. He said that the financial services sector was contributing around 9 percent of the GDP which was not huge. We have to think globally and we also have to think in terms of a hinterland, he said. He said that the environment has to be free for investors to bring in their funds and also to repatriate them. DFCC Bank General Manager/CEO Nihal Fonseka said that Sri Lanka should aim at a growth rate of 12 percent of GDP to reach 10 percent growth rate and that banks should be implement an aggressive lending approach for business. He said that the current banking system was not a sustainable model where banks looked after the interests of the shareholders and employees where they were happy but the depositors were not content with the interest rates. It is an inescapable fact that banks have to be more efficient, and it should be the prerogative of all banks to make use of investments in technology for making the systems more efficient, he said. It is best for the banks to use the technological services to consolidate and make services efficient and also to make use of franchises rather than leap frogging, he said. He advocated a strategy for the banking industry. He said that it was a void that the banking industry did not have a strategy such as in the apparel industry. Referring to news reports which advocated a Parliamentary Select Committee to force banks to bring down interest rates, Capital Alliance Managing Director/CEO Ajith Fernando said that interest rates could not be brought down forcibly as they were market driven. |
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