CENTRAL BANK OF SRI LANKA  
                       
Central bank of Sri Lanka is the monitory authority of Sri Lanka and apex institution in the country’s financial sector. The central bank was establish in 1950, two year after independence under the monitory law Act 58, of 1949 (MLA) the founder governor of the central bank of Sri Lanka was john exter while the minister of finance at that time was J.R. Jayewardene under the former name of Ceylon. It replaced the currency board that until then had been responsible for issuing the country’s money. It is a member of the Asian clearing board.


VISION 

A credible and dynamic central bank contributing to the prosperity of Sri Lanka 
  

MISSION

Maintaining economic and price stability and financial system stability to support sustainable growth through policy stimulus, advice, commitment and excellence. 

OBJECTIVES

The central bank is at the apex of Sri Lanka’s financial system and is responsible for safeguarding both the value of the Sri Lanka rupees and the county’s financial system. Therefore central bank has a responsibility to conduct monitory policy. 
There are two core objective of central bank,
1.      Maintain economic and price stability (both internal and external).
2.      Maintain financial system stability.  
  
Prior to the amendment in 2002, central bank had multiple objectives. Such as,
                   I.            Stabilization of domestic monitory value.
                II.            Preservation of the stability of the exchange rate.
             III.            Promotion of a high level of production.  

THE MONITORY BOARD   


       As the governing body, the monitory board is responsible for making all policy decisions and for the management, operation and administration of the CBSL. 
     The monitory board of the central bank of Sri Lanka consist of five members,
1.      The governor. 
2.      The secretory to the ministry of finance. (Ex – officer).
3.       Three non – executive members.
The governor is the chairmen of the monitory board and also functions as the chief executive officer of the central bank of Sri Lanka.
The governor and the non – executive board members are appointed by the president, on the recommendation of the minister of finance. 

MAIN FUNCTIONS OF CENTRAL BANK OF SRI LANKA 

Core function                                                                                                            

  • Conduct of monitory policy.
  • Conduct of exchange rate policy.
  • Management of the official international reserves.
  • Oversight of the financial system.
  • Licensing, regulation and supervision of banks and selecting non – bank financial institutions.
  • Provision of settlement facilities and the regulation of the payment system.
  • Issue and distribution of the national currency.
  • Compilation and dissemination of economic data and statistics.
  • Acting as the banker and financial adviser to the Government.   

Agency Functions

In addition, the Central Bank of Sri Lanka also performs the following agency functions on behalf of the Government of Sri Lanka

  1. Management of the public debt.
  2. Foreign exchange management.
  3. Fund management and acting as the custodian of the Employees’ Provident Fund.
  4. Facilitating financial inclusion.
  5. Financial intelligence services to detect and prevent money laundering and terrorist financing.

















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