ECONOMYNEXT – Sri Lanka has signed an agreement with Washington-based World Bank to borrow 150 million US dollars to strengthen a deposit insurance scheme, the island’s Finance Ministry said.
The funds will come from the low-interest International Development Association window to which Sr Lanka re-qualified after its sovereign default.
The project will strengthened the “financial and institutional capacity” of the Sri Lanka Deposit Insurance Scheme run by the central bank in line with international best practices for effective deposit insurance schemes, the statement said.
It will increase the reserves of the deposit insurance fund which can be used to pay customers of banks that are liquidated.
The loan agreement was signed by K.M. Mahinda Siriwardana, Secretary to the Treasury, and Faris H. Hadad-Zervos, Country Director for Maldives, Nepal and Sri Lanka on January 31, 2024. (Colombo/Feb02/2024)