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Friday, December 03, 2010 - 5.15 GMT
SL to establish Exim Bank

 
Sri Lanka is to establish an Export Import Bank (Exim Bank) next year to finance exporters and contractors, and to promote trade.The Bank may use some of the funds available as foreign exchange reserves for the capitalization of this proposed Bank, said the Governor of the Central Bank Mr. Agith Nivard Cabraal.

Presently Sri Lanka has a foreign exchange reserve of 6.7 Billion U.S. Dollars.

Governor Cabral has said that the rupee value of foreign reserves is twice the domestic monetary base of about Rs.350 billion. Because earnings on foreign reserves are lower than the cost of domestic sterilization, high foreign reserve levels can create losses in the monetary authority, he added.

According to the Central Bank, they want to have a reserve of about 5.0 months of imports, and the current reserve level sufficient for about 6.3 months of imports is higher than optimum.

 
                   
 
   
   
   
   
   

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Last modified: December 03, 2010.

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