Directions, Determinations, and Circulars issued to Licensed Specialised Banks  219
BANKING ACT NO. 30 OF 1988
AS AMENDED BY BANKING (AMENDMENT) ACT NO. 33 OF 1995
The directions issued by the Monetary Board of the Central Bank of Sri Lanka under Section
76j(1) of the Banking Act, No.30 of 1988 as amended by the Banking (Amendment) Act, No.33
of 1995.
Sgd. A. S. Jayawardena
Governor
Colombo
21-11-1997.
DIRECTIONS UNDER 76 j(1)
DISQUALIFICATION FOR BEING APPOINTED OR ELECTED DIRECTOR
1. No person shall be appointed or elected as a director of a licensed specialised bank if he –
 1.1 has been under any written Law in force in Sri Lanka, found or declared to be of
unsound mind; or
 1.2 is a person who, having been declared insolvent or bankrupt under any law in force in
Sri Lanka or in any other country, is an undischarged insolvent or bankrupt; or
 1.3 has been convicted of an of fence involving moral turpitude and punishable with a term
of imprisonment; or
 1.4 is an employee or a director of any other licensed specialised bank or an employee
(other than the chief executive officer) of the licensed specialised bank.
Provided a director or employee of any licensed specialised bank shall not be disqualified
of being a director of a licensed specialised bank only if the latter licensed specialised bank
is a subsidiary of the first mentioned licensed specialised bank
2. A  director of a licensed specialised bank shall be removed from the office of director if –
 2.1 he becomes subject to any of the disqualifications mentioned in paragraph (1) above;
or
 2.2 he becomes permanently incapable of performing his duties; or
 2.3 he has done an act or thing which is manifestly opposed to the objectives and interests
of the licensed specialised bank.


220 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
BANKING ACT NO. 30 OF 1988
AS AMENDED BY BANKING (AMENDMENT) ACT NO. 33 OF 1995
The directions issued by the Monetary Board of the Central Bank of Sri Lanka under Section
76j(1) of the Banking Act, No.30 of 1988 as amended by the Banking (Amendment) Act, No.33
of 1995.
Sgd. A. S. Jayawardena
Governor
Colombo
21-11-1997.
DIRECTIONS UNDER 76 j(1)
SECRETARY OF A LICENSED SPECIALISED BANK
1. Subject to paragraph 3 of this direction no licensed specialised bank shall appoint as its
Secretary, a person –
 1.1 unless such person possesses such qualifications as may be prescribed for a Secretary
of a company under Sub section (1) of Section 176 of the Companies Act, No.17 of
1982, and;
 1.2 Unless such person is an employee of that licensed specialised bank.
2. Such person so appointed as Secretary shall not become an employee of any other institution
so long as such person continues to be employed as the Secretary of that licensed specialised
bank.
3. This direction shall not apply to the person presently employed as the Secretary of any
Institution specified in Schedule III of the Banking Act.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  221
Determinations made by the Monetary Board of the Central Bank of Sri Lanka under
Section 76 H read with Section 44 A of the Banking Act, No.30 of 1988, as amended.
Sgd. Nivard Ajith Leslie Cabraal
Chairman of the Monetary Board and
Governor of the Central Bank of Sri Lanka
Colombo
24 November 2010
BANKING ACT, DETERMINATION NO. 4 OF 2010
ASSESSMENT OF FITNESS AND PROPRIETY OF
OFFICERS PERFORMING EXECUTIVE FUNCTIONS IN
LICENSED SPECIALISED BANKS
1. This Determination may be cited as the Banking Act, Determination No.4
of 2010. The Sections referred to in this Determination will be those of the
Banking Act, No. 30 of 1988, as amended.
2.1 In terms of Section 76 H read with Section 44 A of the Banking Act, officers
of a licensed specialised bank performing executive functions as may be
determined by the Monetary Board shall be fit and proper persons. Section
42(2) of the Act shall apply in determining whether officers performing
executive functions are fit and proper persons.
2.2 In addition, criteria set out in the Direction No.12 of 2007 on Corporate
Governance for Licensed Specialised Banks in Sri Lanka will also be
applicable.
3. Of ficers holding following designations  / positions are determined as
officers performing executive functions in a licensed commercial bank:
 (i) Additional General Manager
 (ii) Senior Deputy General Manager
 (iii) Deputy General Manager
 (iv) Assistant General Manager
 (v) Chief Operating Of ficer
 (vi) Chief Risk Of ficer
 (vii) Chief Accountant
 (viii) Chief Financial Of ficer
 (ix) Chief Internal Auditor
 (x) Compliance Of ficer
 (xi) Head of Treasury
 (xii) Head of Legal
 (xiii) Head of Information Technology
 (xiv) Board SecretaryCitation.
Empowerment.
Officers
Performing
Executive
Functions.


222 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
 (xv) Of ficers serving as consultants  / advisor to the Board or bank
 (xvi) Any other of ficers falling under the definition of section 3(1)( i)(f)
of the Banking Act, Direction No. 12 of 2007 on Corporate
Governance for Licensed Specialised Banks in Sri Lanka.
4.1 Fitness and propriety of such of ficers performing executive functions shall
be assessed and decided by the Director of Bank Supervision as has been
provided for in the Banking Act and be applicable to those officers:
 (i) currently in of fice,
 (ii) at the time of appointment on a permanent or contract basis,
 (iii) at the time of renewal of employment contracts, and
 (iv) at any other time where there are supervisory concerns in respect
of any officer as may be determined by the Director of Bank
Supervision.
4.2 E ach bank shall obtain from the respective officers an affidavit and a
declaration as in Annex I and Annex II, respectively, and submit to the
Director of Bank Supervision.
4.3 In addition, at the time of first appointment of an of ficer, a letter from the
former employer immediately preceding the appointment (if the former
employer is not a licensed bank in Sri Lanka) regarding the level of
performance of duties assigned to him  / her in the particular institution
should be submitted to the Director of Bank Supervision.
4.4 In the case of expatriate of ficers appointed to branches of banks incorporated
outside Sri Lanka (foreign banks), a letter obtained from the home country
regulator with regard to any supervisory concerns on the suitability of
such officers should be submitted.
4.5 W ith respect to officers, currently performing executive functions, banks
shall obtain and submit affidavits and declarations to Director of Bank
Supervision before 31 December 2010.Procedure to
be followed in
assessing the
fitness and
propriety.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  223
Annex I
Name of Bank :  ………………………………………………………………………………………
Affidavit to be submitted by officers performing executive functions in
Licensed Specialised Banks in terms of Section 76H read with Section 44A of the Banking Act
I, ………………………………………………………………………………………… ( full name )
holder of National Identity Card No.  / Passport No. ……………….………..………..……..…… of
………………….…………………………………………………………………………. ( address)
being a (Buddhist  / Hindu do hereby solemnly, sincerely and truly declare and
affirm  / Christian  / Catholic  /Muslim make oath and state) as follows :
1. I am the [affirmant  / deponent] above named and I am the …………………… ( designation) of
 ……………………………………………………………………………………. ( name of bank )
which is a specialised bank licensed under the Banking Act, No. 30 of 1988.
2. I [af firm  / state] that I possess the following academic and  / or professional qualification/s:
  ……………………………………………………………………………………………………
  ……………………………………………………………………………………………………
3. I [affirm  / state] that the effective experience that I possess in banking, finance, business or
administration or of any other relevant discipline is as follows:
  ……………………………………………………………………………………………………
  ……………………………………………………………………………………………………
4. I [affirm  / state] that there is no finding of any regulatory or supervisory authority, professional
association, any Commission of Inquiry, tribunal or other body established by law in Sri Lanka
or abroad, to the effect that I have committed or have been connected with the commission of,
any act which involves fraud, deceit, dishonesty or any other improper conduct.
5. I [affirm  / state] that I am not subject to an investigation or inquiry consequent upon being
served with notice of a charge involving fraud, deceit, dishonesty or other similar criminal
activity, by any regulatory authority, supervisory authority, professional association, any


activity, by any regulatory authority, supervisory authority, professional association, any
Commission of Inquiry, tribunal or other body established by law, in Sri Lanka or abroad.
6. I [af firm  / state] that I have not been convicted by any Court in Sri Lanka or abroad in respect
of a crime committed in connection with financial management or of any offence involving
moral turpitude.
7. I [affirm  / state] that I am not an undischarged insolvent nor have I been declared a bankrupt in
Sri Lanka or abroad.


224 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
8. I [affirm  / state] that I have not failed, to satisfy any judgment or order of any Court whether
in Sri Lanka or abroad, or to repay a debt.
9. I [affirm  / state] that I have not been declared by a Court of competent jurisdiction in Sri Lanka
or abroad, to be of unsound mind.
10. I [affirm  / state] that I have not been removed or suspended by an order of a regulatory or
supervisory authority from serving in a licensed bank or any other financial institution or
corporate body, in Sri Lanka or abroad.
11. I [affirm  / state] that I have not been a Director, Chief Executive Officer or held any other
position of authority in any bank or financial institution –
 (i) Whose license has been suspended or cancelled; or
 (ii) Which has been wound up or is being wound up, or which is being compulsorily liquidated;
whether in Sri Lanka or abroad.
12. I [affirm  / state] that to the best of my knowledge I am a fit and proper person to hold office
as ……………………………………………………….. (designation ) of a licensed specialised
bank in terms of the provisions of Section 76H read with Section 44A of the Banking Act.
The averments contained
herein were read over to the
[affirmant/deponent] who
having understood the contents
hereof and having accepted
same as true, affirmed/swore
to and placed his/her signature
at Colombo on this ……… day
of …………………..
                            JUSTICE OF THE PEACEAffix Stamps
as applicable
Before me


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  225
Annex II
Name of Bank:  ………………………………………………………………………………………
Declaration to be submitted by officers performing executive functions
in Licensed Specialised Banks in terms of the Banking Act
(with enclosures as appropriate as of ………………….)
1. Personal Details
 1.1 Full name:  ……………………………………………………………………………………
 1.2 NIC / Passport number:  ……………………………………………………………………
 1.3 Date of birth :  ………………………………………………………………………………
 1.4 Permanent address :  …………………………………………………………………………
 1.5 Present address :  ……………………………………………………………………………
2. Appointment to the Bank
 2.1 Date of appointment to the present position:
  (please attach a certified copy of the appointment letter)
 2.2 Designation : …………………………………………………………………………………
 2.3 Local or expatriate :  …………………………………………………………………………
3. Personal Details of Close Relations in terms of Section 86 of the Banking Act
 3.1 Full name of spouse :  ………………………………………………………………………
 3.2 NIC / Passport number :  ……………………………………………………………………
 3.3 Names of dependant children :  ……………………………………………………………
Full name NIC/ Passport number
3.3.1
3.3.2
3.3.3
3.3.4
4. Backgr ound and Experience
 Name/s of licensed bank/s, its subsidiaries in terms of the Banking Act and associates if any, in
which he  / she is or has been employed as an officer performing executive functions:
Name of the institution Period of office Designation


226 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
5. Shar eholdings in Banks and their Related Companies
 Share ownerships in licensed banks, their subsidiaries and associates if any , presently held:
Name of the institution No. of shares Percentage holding
6. Business T ransactions 1/
 Any business transaction the of ficer performing executive functions presently has with the bank
and its subsidiaries and associates if any.
Name
of the
institutionDate of
tran-
saction Amount as at
………………….
(Rs. mn)Classification
(performing/
non-
performing)Type and
value of
collateral
(Rs. mn)% of Bank’ s
regulatory
capital
Limit Out-standing
Accommodations
Investments
Deposits
7. Appointment, Shar eholdings and Business Transactions of Close Relations
7.1 Any close relations presently employed as of ficers performing executive functions in
licensed banks their subsidiaries and associates if any.
Name of the bank Full name of the close relation Position held
1/ “Business transaction” shall mean any accommodations, borrowing s, investments and deposits.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  227
7.2 Direct or indirect share ownership in the bank, its subsidiaries and associates if any ,
presently held by any close relation.
Full name of the close relationNo. of Shares Percentage holding
Direct Indirect Direct Indirect
7.3 Any business transaction, the close relation currently has with the bank, its subsidiaries and
associates if any.
Full name
of the close
relationNature of
business
transactionDate of
tran-
saction Limit
as at
……………
(Rs. mn)Out-
standing
as at
…………
(Rs. mn)Type and
value of
collateral
(Rs. mn)% of
Bank’ s
regulatory
capital
8. A ny other explanation/information in regard to the information furnished above and other
information considered relevant for assessing the suitability of the officer performing executive
functions in the bank.
DECLARATION:
I confirm that the above information is to the best of my knowledge and belief true and complete.
I undertake to keep the bank fully informed, as soon as possible, of all events, which take place
subsequently, which is relevant to the information provided above.
I state that I am not prevented by any Statute from being appointed to the above post.
Date : ……………  …………………………………………………………………………
 Signatur e of Officer Performing Executive Functions in the Bank
TO BE FILLED BY THE CHIEF EXECUTIVE OFFICER
1. Any other explanation  / information in regard to the information furnished above and other
information considered relevant for assessing the suitability of the person performing executive
functions in the bank.
2. I confirm that, in terms of Section 76H read with Section 44A  of the Banking Act, the officer
referred to above is fit and proper to carry out executive functions of the bank.
Date : ……………  …………………………………………………………………………
 Signatur e of Chief Executive Officer
 and the official stamp


228 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Ref. No. : 02  / 17 / 600 /0017  / 001
Bank Supervision Department
27 August 2010
To : CEOs of all Licensed Banks;
Dear Sir  / Madam
APPOINTMENT OF DIRECTORS
Reference our letter No. 02/04/002/0012/002 dated 31 March 2005 on the above subject.
We enclose herewith a revised declaration, which incorporates additional information,
to enable the licensed banks to ascertain compliance with the provisions of the Directions on
Corporate Governance by Directors of banks.
Please replace Annex 2 of the letter under reference with the revised declaration effective
from 01.09.2010.
Yours faithfully,
Sgd, (Mrs.) T M J Y P Fernando
Director of Bank Supervision
Encl.
c.c. -  Mr . Upali De Silva
 Secretary General – Sri Lanka Banks’  Association
 Level 8, Ceylinco House
 No. 69, Janadhipathi Mawatha
 Colombo 01.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  229
Annex 2
Name of Bank:  ………………………………………………………………………………………
Declaration to be submitted in terms of Section 42 of the Banking Act
by persons proposed to be appointed  / elected  / nominated as a Director of
a Licensed Bank
(with enclosures as appropriate as of ………………….)
1. Personal Details
 1.1 Full name:  ……………………………………………………………………………………
 1.2 NIC / Passport number:  ……………………………………………………………………
 1.3 Date of birth :  ………………………………………………………………………………
 1.4 Age :  …………………………………………………………………………………………
 1.5 Permanent address :  …………………………………………………………………………
 1.6 Present address :  ……………………………………………………………………………
 1.7 Occupation :  …………………………………………………………………………………
2. Appointment as a Dir ector of the Bank
 2.1 Date of initial appointment as a Director to the Board of Directors of the bank :  ………
2.2 Nature of the appointment (Executive Director  / Independent Director  / Non-independent
Director  /Non-executive Director  / Alternate Director) :  …………………………………
3. Personal Details of Close Relations 1/ in terms of Section 86 of the Banking Act
 3.1 Full name of spouse :  ………………………………………………………………………
 3.2 NIC / Passport number :  ……………………………………………………………………
 3.3 Names of dependant children :  ……………………………………………………………
Full name NIC / Passport number
3.3.1
3.3.2
3.3.3
3.3.4
4. Backgr ound and Experience
4.1 Name/s of Licensed Bank/s, its subsidiaries2/ in terms of the Banking Act and associates if any, in
which he  / she is or has been a member of the Board of Directors:
Name of the institution Period of office
1/ “Close relation” shall mean the spouse or financially dependant  children.
2/ “Subsidiary” as defined by Section 17(3) of the Banking Act.


230 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
4.2 Names of entities in which he/she presently is a Director:
4.2.1  Names of specified business entities in terms of the Sri Lanka Accounting and
Auditing Standards Act, No. 15 of 1995.
(a)
(b)
(c)
(d)
4.2.2  Names of other institutions  / entities
(a)
(b)
(c)
(d)
4.3 Name/s of Licensed Bank/s, its subsidiaries 2/ and associates if any, in which he  / she is or
has been employed as an officer performing executive functions:
Name of the institution Position  / Designation Period of office
5. Shar eholdings in Banks and their Related Companies
5.1 Direct or indirect share ownerships in licensed banks, their subsidiaries 2/ and associates if
any, presently held:
Name of the institutionNo. of Shares Percentage holding
Direct Indirect Direct Indirect
2/ “Subsidiary” as defined by Section 17(3) of the Banking Act.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  231
6. Business T ransactions 3/
6.1 Any business transaction the Director  / proposed Director currently has  / had with the
licensed banks, their subsidiaries 2/ and associates if any, and finance and leasing companies
registered with Central Bank of Sri Lanka during the last two years immediately preceding
the appointment as Director.
Name
of the
institutionDate of
tran-
saction Amount as at
………………….
(Rs. mn)Classification
(performing/
non-performing)Type and
value of
collateral
(Rs. mn)% of
Bank’ s
regulatory
capital Limit Outstanding
Accommodations
Borrowings
Investments
Deposits
6.2 Any business transaction the Director  / proposed Director currently has  / had during the
last two years immediately preceding the appointment as Director, with “related parties” as
defined by Section 3(7)(i ) of the Banking Act, Direction No.11 and 12 of 2007 on Corporate
Governance for Licensed Banks in Sri Lanka.
Name
of the
institutionDate of
tran-
saction Amount as at
………………….
(Rs. mn)Classification
(performing/
non-performing)Type and
value of
collateral
(Rs. mn)% of
Bank’ s
regulatory
capitalLimit Outstanding
Accommodations
Borrowings
Investments
Deposits
3/ “Business transaction” shall mean any accommodations, borrowing s, investments and deposits.


232 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
7. Appointment, Shar eholdings and Business Transactions of Close Relations
7.1 Any close relation presently appointed as a Director or Chief Executive Of ficer or a
member of the key management of licensed bank/s their subsidiaries and associates if any.
Name of the bank Full name of the close relation Position held
7.2 Direct or indirect share ownership in licensed banks, its subsidiaries and associates if any ,
presently held by any close relation.
Name of the institutionFull name of the
close relationNo. of Shares Percentage holding
Direct Indirect Direct Indirect
7.3 Any business transaction, the close relation currently has or had with licensed banks its
subsidiaries and associates if any during the last two years immediately preceding the
appointment as Director.
Name
of the
institutionFull
name of
the close
relationNature of
business
transactionDate
of
tran-
saction Limit
as at
……………
(Rs. mn)Out-standing
as at
…………
(Rs. mn)Type and
value of
collateral
(Rs. mn)% of
Bank’ s
regulatory
capital
8. Any other explanation  / information in regard to the information furnished above and other
information considered relevant for assessing the suitability of the Director  / proposed Director.
DECLARATION:
I confirm that the above information is to the best of my knowledge and belief true and complete.
I undertake to keep the bank fully informed, as soon as possible, of all events, which take place
subsequently, which is relevant to the information provided above.
I state that I am not prevented by the Articles of Association of the Company and or by any other
Statute from being appointed to the above post.
Date : ……………  ……………………………………………………
 Signatur e of Director  / Proposed Director


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  233
TO BE FILLED BY THE COMPANY SECRETARY
1. Any other explanation  / information in regard to the information furnished above and other
information considered relevant for assessing the suitability of the Director  / proposed Director.
2. Submitted to the Board of Directors of the Bank.
Date : ……………  …………………………………………………………………………
 Signatur e of Company Secretary
 and the official stamp


234 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Ref. No. : 02  / 04 / 0012  / 002
Bank Supervision Department
12 April 2005
To : CEOs of all Licensed Commercial Banks and
       Licensed Specialised Banks;
Dear Sirs,
APPOINTMENT OF DIRECTORS OF BANKS
I refer to my letter of 31 March 2005 on the above subject, enclosing the affidavit and the declaration
to be submitted in respect of directors of banks.
Enclosed please find a fresh affidavit which incorporates the Committee stage amendments to the
Banking (Amendment) Bill. Please replace the affidavit attached to the above letter with this version.
Yours faithfully,
Sgd, Director of Bank Supervision


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  235
Affidavit 	to	be	submitted 	in	terms	of	Section	42(2)	of	the	Banking	Act
I, …………………………………………………….. of ……………………………. Being a [Buddhist
/ Hindu solemnly, sincerely and truly declare and affirm / Christian / Catholic / Muslim make oath and
state] as follows :
 (a) I am the [affirmant / deponent] above named and I [am a director / have been elected as a
director / have been nominated as a director] of ……………………………… which is a licensed
commercial bank / licensed specialised bank, licensed under the Banking Act, No.30 of 1988.
 (b) I [af firm/state] that I possess the following academic and / or professional qualifications :
 (c) I [affirm/state] that the effective experience that I possess in banking, finance, business or
administration or of any other relevant discipline is as follows :
 (d) I [affirm/state] that there is no finding of any regulatory or supervisory authority, professional
association, any Commission of Inquiry, tribunal or other body established by law in Sri Lanka or
abroad, to the effect that I have committed or have been connected with the commission of, any
act which involves fraud, deceit, dishonesty or any other improper conduct;
 (e) I [affirm/state] that as such I am not subject to any investigation or inquiry consequent upon
being served with notice of a charge involving fraud, deceit, dishonesty or other similar criminal
activity, by any regulatory authority, supervisory authority, professional association, Commission
of Inquiry, tribunal or other body established by law, in Sri Lanka or abroad;
 (f) I [affirm/state] that I have not been convicted by any Court in Sri Lanka or abroad in respect of
a crime committed in connection with financial management or of any offence involving moral
turpitude;
 (g) I [affirm/state] that I am not an undischarged insolvent nor have I been declared a bankrupt in Sri
Lanka or abroad;


236 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
 (h) I [affirm/state] that I have not failed, to satisfy any judgment or order of any court whether in Sri
Lanka or abroad, or to repay a debt;
 (i)  I [affirm/state] that I have not been declared by a court of competent jurisdiction in Sri Lanka or
abroad, to be of unsound mind;
 (j) I [affirm/state] that I have not been removed or suspended by an order of a regulatory or
supervisory authority from serving as a director, Chief Executive Officer or other officer in any
bank or financial institution or corporate body, in Sri Lanka or abroad;
 (k) I [affirm/state] that I have not been a director, Chief Executive Officer or held any other position
of authority in any bank or financial institution –
 (i) whose license has been suspended or cancelled; or
 (ii) which has been wound up or is being wound up, or which is being compulsorily liquidated;
whether in Sri Lanka or abroad.
 (l) I [affirm/state] that to the best of my knowledge I am a fit and proper person [to
hold office as a director / to be appointed, nominated or elected as a director] of
a licensed commercial bank / licensed specialised bank in terms of the provisions
of Section 42 of the Banking Act as amended by Banking (Amendment) Act,
No. 2 of 2005.
The averments contained herein  ]
were read over to the [affirmant/deponent  ]
who having understood the contents  ]
hereof and having accepted same as  ] Before me
true, swore to and placed his / her signature  ]
at Colombo on this ……………… day  ]
of ………………  ]
                                                              JUSTICE OF THE PEACE


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  237
Ref. No. : 02  / 04 / 002 / 0012  / 002
Bank Supervision Department
31 March 2005
To : The CEOs of all Licensed Commercial Banks (Domestic) and
 Licensed Specialised Banks
Dear Sirs,
APPOINTMENT OF DIRECTORS OF BANKS
(SECTION 42 OF THE BANKING ACT, NO.30 OF 1988 AS AMENDED)
 In terms of Section 42(1) of the Banking Act a person who is to be appointed, elected or
nominated as a director of a licensed commercial bank or who continues as a director of such bank
must be a fit and proper person to hold such office and should not be prevented from doing so by the
provisions of the Banking Act or by any other written law. The Act also sets out specific matters to be
taken into consideration in determining whether a person is fit and proper .
 Further , in terms of Section 42(4) of the Act, all banks are required to notify the Director
of Bank Supervision, details of proposed/appointed/elected/nominated directors for approval under
Section 42(5).  Boards of licensed commercial banks should ensure that adequate information relating
to any person who is to be appointed, elected or nominated to the Board of Directors is made available
to the Board before such appointment, election or nomination takes place. Furthermore, it is necessary
that relevant information in respect of current directors should also be available to the Board of
Directors.
 For this purpose we annex hereto a draft affidavit to be obtained from all directors and
persons nominated for election or appointment as directors of the bank or to be nominated to
the Board. In addition to the affidavit, a declaration may also be obtained from such person to
enable the bank to ascertain compliance by directors of the bank with other provisions of the
Act. For this purpose a draft declaration as in Annex 2 may be used.  The Secretary of each


Act. For this purpose a draft declaration as in Annex 2 may be used.  The Secretary of each
bank shall submit a copy of the affidavit and the declaration in respect of each such person to
be appointed, to the Director of Bank Supervision, together with the information specified in
sub-section (4) of Section 42, by the bank when approval for appointment, election or nomination of a
director is sought.
 W ith respect to current directors, the declaration and affidavit should be obtained and copies
furnished to the Central Bank in respect of each director holding office, by 30 April 2005. Thereafter,
the declaration and affidavit should be obtained and copies furnished to the Central Bank annually,
before the Annual General Meeting of the respective bank in respect of every continuing director.
Yours faithfully,
Sgd, Director of Bank Supervision
cc – Mr . Upali De Silva
 Secretary-General – Sri Lanka Bankers Association
 Level 8, Ceylinco House, 69, Janadhipathi Mawatha
 Colombo 01.


238 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Affidavit 	to	be	submitted 	in	terms	of	Section	42(2)	of	the	Banking	Act
I, …………………………………………………….. of ……………………………. Being a [Buddhist
solemnly, sincerely and truly declare and affirm/Christian/Catholic make oath and state/Muslim make
oath and state] as follows :
 (a) I am the [affirmant / deponent] abovenamed and I [am a director / have been elected as a director
/ have been nominated as a director] of ……………………………… which is a licensed
commercial bank / licensed specialized bank, licensed under the Banking Act, No. 30 of 1988.
 (b) I [affirm/state] that I possess the following academic and/or professional qualifications :
 (c) I [affirm/state] that the effective experience that I possess in banking, finance, business or
administration or of any other relevant discipline is as follows :
 (d) I [affirm/state] that there is no finding of any regulatory or supervisory authority, professional
association, any Commission of Inquiry, tribunal or other body established by law in Sri Lanka or
abroad, to the effect that I have committed or have been connected with the commission of, any
act which involves fraud, deceit, dishonesty or any other improper conduct;
 (e) I [affirm/state] that as such I am not subject to any investigation or inquiry in Sri Lanka or
elsewhere by any regulatory authority, or supervisory authority, professional association, any
Commission of Inquiry, tribunal or other body established by law in Sri Lanka or abroad, that I
have committed or have been connected with the commission of, any act which involves fraud,
deceit, dishonesty or any other improper conduct;
 (f) I [affirm/state] that I have not been convicted by any Court in Sri Lanka or abroad in respect of
a crime committed in connection with financial management or of any offence involving moral
turpitude;


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  239
 (g) I [affirm/state] that I am not an undischarged insolvent nor have I been declared a bankrupt in Sri
Lanka or abroad;
 (h) I [affirm/state] that I have not failed, to satisfy any judgment or order of any court whether in Sri
Lanka or elsewhere, or to repay a debt;
 (i)  I [affirm/state] that I have not been declared by a competent court in Sri Lanka or abroad, to be
of unsound mind;
 (j) I [affirm/state] that I have not been removed or suspended by an order of a regulatory or
supervisory authority from serving as a director, Chief Executive Officer or other officer in any
bank or financial institution or corporate body, in Sri Lanka or abroad;
 (k) I [affirm/state] that I have not been a director, Chief Executive Officer or held any other position
of authority in any bank or financial institution –
 (i) whose license has been suspended; or
 (ii) which has been wound up or is being wound up, or which is being compulsorily liquidated;
whether in Sri Lanka or elsewhere.
 (l) I [affirm/state] that to the best of my knowledge I am a fit and proper person [to
hold office as a director / to be appointed, nominated or elected as a director] of
a licensed commercial bank / licensed specialised bank in terms of the provisions
of Section 42 of the Banking Act as amended by Banking (Amendment) Act,
No. 2 of 2005.
The averments contained herein                        ]
were read over to the [affirmant/deponent         ]
who having understood the contents                  ]
hereof and having accepted same as                  ]                Before me
true, swore to and placed his/her signature        ]
at Colombo on this ……………… day             ]
of ………………………                                   ]
                                                                                JUSTICE OF THE PEACE


240 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex 2
Name of Bank: …………………………………………………
Declaration to be submitted in terms of Section 42 of the Banking Act
by persons proposed to be/appointed/elected/nominated as a Director of a Licensed Bank
(with enclosures as appropriate as of ………………….)
1. Personal Details
1.1 Full name:
1.2 NIC No./Passport No.:
1.3 Permanent Address:
1.4 Present Address:
1.5 Occupation:
2. List of close r elations in terms of Section 86 of the Banking Act:
2.1 Name in full of spouse:
 NIC No./Passport No. :
2.2 Names of dependent children:
  Full Name     NIC No. / Passport No.
1.
2.
3.
4.
3. List of entities in which director/prospective director has a substantial interest in terms of Section
86 of the Banking Act


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  241
4. Name/s of Licensed Bank/s in which he/she is or has been a member of the Board of Directors
(give details of period during which such office was held)
5. Accomodation, if any, presently availed by him/her or by his close relations at 2 above, and by
entities at 3 above from the bank, and collateral
Declaration:
I confirm that  the  above information is to the  best of my knowledge and belief true and complete.
I undertake to keep the bank fully informed, as soon as possible, of all events  which take place
subsequently which are relevant to the  information provided above.
Signature:
Date:
Any other explanation/information in regard to the information furnished above and other information
considered relevant for assessing the suitability of the proposed/appointed director .
Remarks of Board of Directors of the Bank
Date:                                                                                Signature of Company Secretary


242 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Ref. No. : 02  / 17 / 550 /002 / 003
Bank Supervision Department
24 December 2010
To : CEOs of all Licensed Commer cial Banks;
 Licensed Specialised Banks, and
 Auditors conducting Bank Audits
Dear Sir  / Madam,
REQUIREMENTS UNDER
THE CORPORATE GOVERNANCE DIRECTION
We write to inform you that the Institute of Chartered Accountants of Sri Lanka (ICASL) has issued
guidelines on the internal control mechanism and annual corporate governance report to be followed
by banks in relation to Directions 3(8)(ii) (b), (c) and (g) of the Corporate Governance Direction dated
26.12.2007 issued by the Central  Bank of Sri Lanka.
Please find the guidelines in the website of the ICASL.  The link is as follows:
http://www.icasrilanka.com/Technical/Central%20Bank%20Internal%20Control%20-%20
         Final%20printed%20uploaded.pdf
Yours faithfully,
Sgd, N W G R D Nanayakkara
Addl. Director of Bank Supervision
c.c. -  President
 Institute of Chartered Accountants of Sri Lanka
 30A  Malalasekera Mawatha
 Colombo 7.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  243
Ref. No. : 02  / 17 / 600 / 0017  / 001
Bank Supervision Department
08 August 2011
To : CEOs of Licensed Specialised Banks
Dear Sirs,
ASSESSMENT OF FITNESS AND PROPRIETY OF
CHIEF EXECUTIVE OFFICERS OF
LICENSED SPECIALISED BANKS
In terms of Section 76 H read with Section 44 A of the Banking Act, Chief Executive Officers
(CEOs) of Licensed Specialised Banks (LSBs) are required to be fit and proper persons to perform
executive functions in a LSB.
Accordingly, we enclose herewith formats for the affidavit and the declaration to be submitted by
the CEOs of LSBs and a guidance note to duly complete such affidavits and the declarations.
Annex I  :  Affidavit to be submitted by CEOs of LSBs
Annex II  :  Declaration to be submitted by CEOs of LSBs
Annex III  :  Guidance Note
Yours faithfully,
(Mrs.) T M J Y P Fernando
Director of Bank Supervision


244 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex I
Name of Bank :  …………………………………………………………………………………………
Affidavit 	to	be	submitted 	by	Chief	Executive 	Officers	of
Licensed Specialised Banks in terms of Section 76 H read with Section 44 A of the Banking Act
I, ……………………………………………………………………………………………… ( full name)
holder of National Identity Card No.  / Passport No. ……………….………..……..……..……………… of
………………….………………………………………………………………………………. (address)
being a [Buddhist  / Hindu do hereby solemnly, sincerely and truly declare and affirm  / Christian  / Catholic  /
Muslim make oath and state] as follows :
(a) I am the [affirmant  / deponent] above named and I am the [ Chief Executive Officer  / proposed Chief
Executive Officer] of …………………………………………………………………………………
……………. (name of bank) which is a specialised bank, licensed under the Banking Act, No. 30 of
1988.
(b) I [affirm  / state] that I possess the following academic and  / or professional qualification/s:
  ………………………………………………………………………………………………………
  ………………………………………………………………………………………………………
(c) I [affirm  / state] that the effective experience that I possess in banking, finance, business or
administration or of any other relevant discipline is as follows:
  ………………………………………………………………………………………………………
  ………………………………………………………………………………………………………
(d) I [affirm  / state] that there is no finding of any regulatory or supervisory authority, professional
association, any Commission of Inquiry, tribunal or other body established by law in Sri Lanka or
abroad, to the effect that I have committed or have been connected with the commission of, any act
which involves fraud, deceit, dishonesty or any other improper conduct.
(e) I [affirm  / state] that I am not subject to an investigation or inquiry consequent upon being served
with notice of a charge involving fraud, deceit, dishonesty or other similar criminal activity, by any


regulatory authority, supervisory authority, professional association, any Commission of Inquiry,
tribunal or other body established by law, in Sri Lanka or abroad.
(f) I [affirm  / state] that I have not been convicted by any Court in Sri Lanka or abroad in respect of
a crime committed in connection with financial management or of any offence involving moral
turpitude.
(g) I [affirm  / state] that I am not an undischarged insolvent nor have I been declared a bankrupt in Sri
Lanka or abroad.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  245
(h) I [affirm  / state] that I have not failed, to satisfy any judgment or order of any Court whether in Sri
Lanka or abroad, or to repay a debt.
(i) I [affirm  / state] that I have not been declared by a Court of competent jurisdiction in Sri Lanka or
abroad, to be of unsound mind.
(j) I [affirm  / state] that I have not been removed or suspended by an order of a regulatory or supervisory
authority from serving as a Director, Chief Executive Officer or other officer in any licensed bank or
financial institution or corporate body, in Sri Lanka or abroad.
(k) I [affirm  / state] that I have not been a Director, Chief Executive Officer or held any other position of
authority in any bank or financial institution –
 (i) whose license has been suspended or cancelled; or
 (ii) which has been wound up or is being wound up, or which is being compulsorily liquidated;
whether in Sri Lanka or abroad.
(l) I [affirm  / state] that to the best of my knowledge I am a fit and proper person [to hold office as a
Chief Executive Officer  / to be appointed as a Chief Executive Officer] of a licensed specialised bank
in terms of the provisions of Section 76 H read with Section 44 A of the Banking Act.
The averments contained
herein were read over to
the [affirmant  / deponent]
who having understood the
contents hereof and having
accepted same as true,
affirmed  / swore to and
placed his  / her signature at
…………………..… on this
……………………… day of
…………………..
JUSTICE OF THE PEACE  /
COMMISSIONER FOR OATHSAffix Stamps
as applicable
Before me


246 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex II
Name of Bank:  …………………………………………………………………………………………
Declaration 	to	be	submitted 	by	Chief	Executive 	Officers	of
Licensed Specialised Banks in terms of Section 76 H read with Section 44 A of the Banking Act
(with enclosures as appropriate as of ………………….)
1. Personal Details
 1.1 Full name:  ………………………………………………………………………………………
 1.2 NIC / Passport number:  …………………………………………………………………………
 1.3 Date of birth :  …………………………………………………………………………………
 1.4 Permanent address :  ……………………………………………………………………………
 1.5 Present address :  ………………………………………………………………………………
2. Appointment to the Bank
 2.1 Date of appointment :
  (please attach a certified copy of the appointment letter)
 2.2 Designation :  ……………………………………………………………………………………
 2.3 Local or expatriate :  ……………………………………………………………………………
3. Backgr ound and Experience
 Name/s of licensed bank/s, its subsidiaries in terms of the Banking Act and associates if any, in
which he  / she is or has been employed as Chief Executive Officer, Director or an officer performing
executive functions:
Name of the institution Period of office Designation
4. Shar eholdings in Banks and their Related Companies
 Share ownerships in any licensed banks, their subsidiaries and associates, if any , presently held:
Name of the institution No. of shares Percentage holding


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  247
5. Business Transactions1/
 Any business transactions the Chief Executive Officer  / proposed Chief Executive Officer presently
has with the bank and its subsidiaries and associates, if any.
Name
of the
institutionDate of
tran-
saction Amount as at
………………….
(Rs. mn)Classification
(performing/
non-performing)Type and
value of
collateral
(Rs. mn)% of Bank’ s
capital
Limit Out-standing
Accommodations
Investments
Deposits
6. Personal Details of Close Relations in terms of Section 86 of the Banking Act
 6.1 Full name of spouse :  ……………………………………………………………………………
 6.2 NIC / Passport number :  ………………………………………………………………………
 6.3 Names of dependant children :  …………………………………………………………………
Full name NIC / Passport number
6.3.1
6.3.2
6.3.3
6.3.4
7. Appointments, Shar eholdings and Business Transactions of Close Relations
7.1 A ny close relations presently employed as Chief Executive Officers, Directors or officers
performing executive functions in any licensed banks, their subsidiaries and associates, if any.
Name of the bank Full name of the close relation Position held
1/ “Business transaction” shall mean any accommodations, investments and deposits and in the case of
foreign banks, only the business transactions with Sri Lankan operations.


248 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
7.2 Direct or indirect share ownership in the bank, its subsidiaries and associates, if any, presently
held by any close relation.
Full name of the close relationNo. of Shares Percentage holding
Direct Indirect Direct Indirect
7.3 Any business transaction, the close relation currently has with the bank, its subsidiaries and
associates, if any.
Name
of the
institutionDate of
tran-
saction Amount as at
………………….
(Rs. mn)Classification
(performing/
non-performing)Type and
value of
collateral
(Rs. mn)% of Bank’ s
regulatory
capital
Limit Out-standing
Accommodations
Investments
Deposits
8. Any other explanation  / information in regard to the information furnished above and other
information considered relevant for assessing the suitability of the Chief Executive Officer  / proposed
Chief Executive Officer  of the bank.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  249
DECLARATION:
I confirm that the above information is to the best of my knowledge and belief true and complete.
I undertake to keep the bank fully informed, as soon as possible, of all events, which take place
subsequently, which is relevant to the information provided above.
I state that I am not prevented by any Statute from being appointed as the Chief Executive Officer of
Licensed Specialised Bank.
Date : ……………  …………………………………………………………………………
 Signature of Chief Executive Officer  /
 Proposed Cheif Executive Officer
TO BE FILLED BY THE CHAIRMAN / REGIONAL HEAD (in the case of foreign banks)
1. Any other explanation  / information in regard to the information furnished above and other
information considered relevant for assessing the suitability of the Chief Executive Officer  / proposed
Chief Executive Officer of the bank.
2. I confirm that, in terms of Section 76 H read with Section 44 A of the Banking Act, No. 30 of 1988,
the officer referred to above is fit and proper to carry out functions of the Chief Executive Officer of
…………………………… .
Date : ……………  …………………………………………………………………………
 Signature of the Chairman / Regional Head
 and the official stamp


250 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex III
GUIDANCE TO DULY COMPLETE THE AFFIDA VITS AND
DECLARATIONS TO BE SUBMITTED BY CHIEF EXECUTIVE OFFICERS OF
 LICENSED SPECIALISED BANKS
A. PURPOSE OF  OBTAINING AFFIDA VITS AND DECLARATIONS
• T he purpose of obtaining affidavits and declarations of Chief Executive Officers (CEOs) of
Licensed Specialised Banks (LSBs) is to enable the Bank Supervision Department to assess the
fitness and propriety of such officers in terms of the provisions of the Banking Act. Accordingly,
the Bank Supervision Department requires comprehensive information to evaluate the experience,
qualifications, integrity and compliance with other requirements specified in the Banking Act, to
assess the suitability of the CEOs of the LSBs.
• Further , these should be legally binding documents in the event of any dispute.
• This guidance is issued to ensure that sufficient information is provided by banks for assessing the
fitness and propriety of the CEOs.
B. AFFIDA VITS
1. It is preferable that the affidavit is prepared as a fresh document, based on the format provided by the
Bank Supervision Department, so as to avoid inclusion of unnecessary words. However, if the given
format is filled, all alterations, erasures and interlineations should be initialed by the Commissioner
for Oaths.
2. Academic/professional qualifications
• Relevant qualification should be mentioned clearly with:
 – Qualification obtained
 – Name of the Institution/University
 – Y ear of obtaining the qualification
 – Name of the Professional body where he/she is a member
3. Ef fective experience should include:
• Institution
• Designation
• Period
4. Complete all blank spaces and clauses appropriately. ( Eg., Name in full, NIC No. / Passport No.,
Address, Chief executive officer/proposed chief executive officer, Name of the Bank, etc.)
5. Appropriate words should be used based on the religion of the person


5. Appropriate words should be used based on the religion of the person
5.1 Delete/strike out inappropriate words
Eg.
• Buddhist/Hindu:  affirm/affirmant/solemnly , sincerely and truly declare and affirm.
• Christian/Catholic/Muslim:  deponent/state/make oath and state/ swear .
• If a person refrains/objects to disclose his/her religion:   affirm/affirmant/solemnly, sincerely
and truly declare and affirm. In this event, a confirmation should be submitted by the officer
stating that:
– he/she is an atheist or belongs to a religion not mentioned in this affidavit;   or
– he/she objects to disclosing his/her religion.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  251
5.2 If the inappropriate words are stricken out, the Commissioner for Oaths/Justice of the Peace
should place his initials immediately after all such amendments.
6. If the person is a foreigner and signs the affidavit while overseas:
– signature of the person should be attested by a Commissioner for Oaths or an equivalent in the
country in which he places his signature.
– a ttestation should be made in front of the Sri Lankan High Commissioner in the respective
country.
7. Affix a stamp for a sum of Rs.25/- and the signature of the person. In the case of future affidavits,
the denomination of the stamp should be changed according to the value applicable as at the date of
signing the affidavit.
8. Attest by a Commissioner for Oaths/Justice of the Peace immediately after the signature of the person
at ‘Before me’.
C. DECLARATIONS
1. Declarations:
– should be duly completed : All the sections (1-8) should be completed (full name, date etc.) and
irrelevant sections stated as Not applicable/nil/none or cancelled out.
– should be signed and dated.
2. The last section should be completed, dated and signed with official stamp/seal by the Chairman/
Regional Head (in the case of foreign banks). If there is no comment it should be stated as Not
applicable/nil/none.
3. T erms of appointment (including designation, date of appointment, duties, responsibilities and
remuneration package) should be attached.
D. INTERPRET ATION
1. “Close relation” means spouse or dependent child.
2. “Business Transaction” shall means any accommodations, investment and deposits and in the case
of foreign banks, only the business transactions with Sri Lankan operations.
3. “Accommodation” means any loan, overdraft or advance or such other facility as may be determined
by the Monetary Board or any commitment to grant any loan, overdraft or advance or such other


by the Monetary Board or any commitment to grant any loan, overdraft or advance or such other
facility as may be determined by the Monetary Board, including a commitment to accept a contingent
liability.


252 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Our Ref. : 02  / 17 / 600 / 0036  / 001
Bank Supervision Department
17 July 2012
To : Chief Executive Officers of
       all locally incorporated licensed banks
Dear Sir / Madam,
SPECIAL PAYMENTS  / BENEFITS TO DIRECTORS AT THEIR RETIREMENT
Having observed that exorbitant special payments  / benefits have been made in the form of gratuity
to retiring directors of some banks and that such payments  / benefits are not prudent in terms of good
governance, the Monetary Board has decided to require licensed banks to obtain prior approval of
shareholders for any special payments  / benefits made to bank directors at their retirement in addition to
normal remuneration.
Accordingly, all locally incorporated licensed banks are requested to:
(1) i ncorporate such special payments  / benefits to its directors at their retirement to the
remuneration policy;
(2) obtain prior approval of the shareholders for any special payments  / benefits made to directors
at their retirement in addition to normal remuneration;
(3) ensure that all special payments  / benefits are extended on arm’s length basis; and
(4) disclose separately the aggregate value of total special payments  / benefits made to retiring
directors during the respective financial year in the Annual Report.
Yours faithfully,
(Mrs.) T M J Y P Fernando
Director of Bank Supervision
Cc :  Chairmen of all locally incorporated licensed banks


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  253
Ref. No. : 02  / 17 / 550 /002 / 003
Bank Supervision Department
29 March 2012
To : CEOs of all Licensed Banks and
 Panel of Qualified Auditors
Dear Sir  / Madam,
DISCLOSURE IN ANNUAL REPORTS
BANKING ACT DIRECTIONS ON CORPORATE GOVERNANCE
We write to inform you that, the Monetary Board has approved of accepting the following as
substitutes for compliance with the Directions 3(8)( ii)(c) and 3(8)(ii)(g) of the Banking Act, Directions
No. 11 and 12 of 2007.
Direction Disclosure Requirements Substitute Disclosure Requirements
3(8)(ii)(c) The external auditor’s
certification on the
effectiveness of the internal
control mechanism reported
by the board of directorsThe Assurance Report issued by the auditors under
“Sri Lanka Standard on Assurance Engagements
SLSAE 3050 – Assurance Reports for Banks on
Directors’ Statements on Internal Control”.
3(8)(ii)(g) The external auditor’s
certification of the compliance
with Corporate Governance
Directions in the annual
corporate governance reports
published in the annual reportA confirmation by the Board of Directors in its Annual
Corporate Governance Report that all the findings
of the “Factual Findings Reports” of auditors issued
under “Sri Lanka Related Services Practice Statement
4750” have been incorporated in the Annual Corporate
Governance Report, provided that auditors confirm to
the Director of Bank Supervision to this effect.
Accordingly, you are required to adhere to the above requirements.
Yours faithfully,
(Mrs.) T M J Y P Fernando
Director of Bank Supervision


254 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Explanatory Note: 1  / 2012
Bank Supervision Department
06 July 2012
AUTHORITY OF THE MONETARY BOARD
TO ISSUE DIRECTIONS TO LICENSED BANKS REAFFIRMED BY THE
COURT OF APPEAL
The Monetary Board of the Central Bank of Sri Lanka (CBSL) issued Directions on corporate
governance to licensed banks on 26 December 2007. The Directions were issued in terms of the Banking
Act requiring, inter alia,  fitness and propriety of bank directors, limiting the age of a director of a bank
to 70 years, the term of office of a director to be not more than 9 years, etc.
Consequent to issuing these Directions, the authority of the Monetary Board of the CBSL to
issue such Directions was challenged in the Court of Appeal CA (Writ) Application No. 330 /2008 by
K.C. Vignarajah, the Petitioner.
As per the Court of Appeal judgment of the above action delivered on 28 March 2012, it was held
that, inter-alia , the Banking Act, No. 30 of 1988 falls within the category of legislation referred to as
Administrative Legislation, and that a necessary aspect of such legislation is one of delegating powers
to an extraneous body of persons to act at Parliament’s bidding. The Court further held that, accordingly,
the Banking Act is a Primary Legislation for the purpose of providing for any aspect of banking business
and of business of such banks and includes the right to control the existing systems and functions of banks,
and therefore that the Monetary Board has been delegated with the power to make directions which had the
approval, licence or stamp of a legislative power. On that basis, the Court of Appeal ruled that Direction
No.11 of 2007 on Corporate Governance of 26 December 2007 is within the powers prescribed in the
Banking Act, No. 30 of 1988, as amended.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  255
Ref. No. : 02  / 17 / 402 / 0079  / 001
Bank Supervision Department
May 02, 2006
To :  CEOs of Licensed Commer cial Banks and
   CEOs of Licensed Specialised Banks
Dear Sirs,
IMPLEMENTATION OF THE PROVISIONS OF PART IX
(SECTIONS 72 TO 76) OF THE BANKING ACT ON ABANDONED PROPERTY
As intimated to you at the meeting of the CEOs of Licensed Commercial Banks and Licensed
Specialised Banks held on 24.11.05, in terms of Section 73(1) of the Banking Act, all licensed
commercial banks (LCBs) are hereby required to report “Abandoned Property” referred to in
Section 72 of the Banking Act in the format determined by the Monetary Board given in Annex 1.
In implementing the provisions of the Banking Act on Abandoned Property LCBs are requested to
follow the guidelines at Annex 2.
The provisions of the Banking Act do not require the licensed specialized banks (LSBs) to
report Abandoned Property. However, the LSBs too are requested to identify the articles that could
be considered abandoned as described in Section 72 of the Banking Act and to report them using the
format at Annex 1 till such time these provisions are made applicable to LSBs as well.
The first Report should contain property that would have been presumed abandoned up to
31.12.2005.
Please acknowledge receipt of this letter.
Yours faithfully,
Sgd, Director of Bank Supervision
Encl:


256 Directions, Determinations, and Circulars issued to Licensed Specialised BanksAnnex 1
Report of Abandoned Property
Name of Bank          :
Reporting Period      :
A B C D E F G H I J K L M
Owner’s
Last Name
with Other Names
in Full Last
known
Complete
AddressOwner’s
Identification
Nos., if available
(NIC,
Passport No.,
date of birth etc.)Descrip-
tion
of
PropertyProperty
Identi-
fication
NumberInterest
bearing
Yes/NoLast
Activity
DateNature
of
ActivityAmount
DueAmount
DeductedDescrip-
tion
of
DeductionAmount Terms of
Agreement
and owner’s
instructions
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
Total

I, ……………………………………………………….., being first duly sworn, on oath depose and state that I have cause to be prepared and have examined
this report consisting of …………………pages totaling Rs …………….. as to property presumed abandoned under the provisions of the Banking Act, No.30
of 1988, for the period stated above that I am duly authorised by the ...................................................................... (name of the bank) to execute this Report
and that to the best of my knowledge and belief the Report is true, correct and complete as of said date, excepting for such property as has since ceased to be
abandoned.
Signature:  ………………………………………      Name: ………………………………………    Designation:   ………………………………………

Sworn and placed his/her signature before me on this ….. day of………  in the year ……
Signature:  ………………………………………      Name: ………………………………………


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  257
Annex 2
Guidelines on the implementation of Part IX (Section 72 to 76) of the Banking Act
on Abandoned Property
The Central Bank of Sri Lanka has decided to implement the provisions of Part IX of the Banking Act
with effect from 31 December 2005. These guidelines establish the procedures for handling such property.
1.	Identification 	of	Abandoned 	Property
a. All licensed commercial banks (LCBs) should identify articles presumed to be abandoned property
as described in Section 72 of the Banking Act. In general abandoned property includes the following
articles in respect of which no activity has been evidenced for a period of ten years.
• Any general deposit (demand, savings or matured time deposit) with an LCB with any interest
or dividend but excluding any lawful charges.
• Any funds paid towards the purchase of shares or other interests in an LCB with any interest or
dividend but excluding any lawful charges.
• Any sum payable on cheques or other instruments for which the LCB is directly liable.
• Any intangible personal property and any income or interest thereon held in a fiduciary capacity.
• The contents of safe deposit boxes upon which the rental period has expired and of which notice
has been sent by registered post to the last known address of the lessee and the lessee has failed
to respond within three years.
b. Activity in this regard is evidenced by any action taken by an owner with respect to his property,
which indicates that the owner does not intend his property to be considered abandoned. Such
action would include a deposit or a withdrawal in the case of a customer account, notification of
change of address, payment of a safe deposit rental charge, any other written correspondence,
presenting the pass book for updating etc.
2. Filing of the Report on Abandoned Property with the Central Bank of Sri Lanka (CBSL)


2. Filing of the Report on Abandoned Property with the Central Bank of Sri Lanka (CBSL)
a. All LCBs holding any abandoned property should submit a report to CBSL within six months of the
end of each financial year. The first Report should cover property that would have been presumed
abandoned up to 31.12.2005. In the case of LCBs whose financial year ends on 31 March, the first
report may cover the position as at 31.03.2006.
b. A ll reporting of abandoned property should be in accordance with the format approved by the
Monetary Board given at Annex 1. Information should be recorded in alphabetical order of the
owners’ last name, to the extent possible, and branchwise. Minors accounts should be reported
separately. The process of identifying and completing the Report is expected to be automated by
LCBs.
c. While the banks should report all property that falls within the definition of abandoned property, if
there are special considerations attached to such property, e.g.: the owner having migrated or left the
country for an infinite period with notice to the bank, such special consideration should be reported
to CBSL.
d. Where an LCB does not hold any abandoned property to be reported as required by Section 73
of the Banking Act, the respective bank is expected to formally communicate it to CBSL. Such
communication will be considered as a “Negative Report”.
e. Prior to reporting abandoned property to CBSL, the banks should make notification of it to the
owner of such abandoned property, by registered mail, to the last known address of the owner giving
a reasonable period to respond. Such notice should include a description of the property, a statement
explaining the statutory requirements of abandoned property and the intended date that the property


258 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
will be reported to CBSL if there is no response. In the case of Minors’ accounts where the banks are
of the view that it is not reasonable to consider a particular account as abandoned due to its intrinsic
characteristics, banks need not notify the owners/guardians of such accounts. However, the banks
should report all Minors’ accounts that fall within the definition of abandoned property to CBSL
with specific mention why they should not be considered as abandoned property .
f. Pursuant to the filing of a Report on Abandoned Property, a bank should maintain documents
necessary to prove information submitted in the Report for a period of at least six years from the
date of submitting the Report.
3. Delivery of Abandoned Property to CBSL
Any further action to be taken in terms of Subsections (2) and (3) of Section 73 of the Banking Act
will be notified to all LCBs in due course.
4. Publication of Notice of Abandoned Property
a. In accordance with Section 74 of the Banking Act a bank should, within thirty days of submission
of the Report, required under paragraph 2.a above,
• publish a notice in the Sinhala, Tamil and English daily newspapers stating the name of the owner
and particulars concerning the property; and
• should dispatch by registered post, a notice containing particulars of the property to the last
known address of the owner.
b. W ith regard to Minors’ accounts, the procedure stated in paragraph 2 e. above should be followed.
5. Drilling/Opening of safe deposits
a. T he bank should prepare a Safe Deposit Inventory Sheet to record details of safe deposit
boxes opened. Opening of the safe custody lockers should be carried out in the presence of
two responsible officers who are, inter-alia, specifically assigned with such task and one of
whom should be at least at Senior Executive Level. All items found in safe deposit boxes


whom should be at least at Senior Executive Level. All items found in safe deposit boxes
presumed to be abandoned should be included in the Inventory Sheet without exceptions.
No item should be sold, destroyed or disposed.
b. The format at Annex 3 may be used for this purpose. The Inventory Sheet should be signed by the
staff conducting the inventory and returned to CBSL along with the Report on Abandoned Property.
c. All items contained in the safe deposit boxes should be itemised and kept in safe custody after the
drilling/opening of safe deposit boxes.
6. The costs
The banks should attempt to comply with these guidelines in the most cost efficient manner. These
costs should be charged to the owners of abandoned property only if it has been made known to the
customers in a valid, enforceable and written contract between the bank and the customer, specifying
the amount of the fee and the customer is notified of the charging of such fee.
7. Submission of information by licensed specialized banks (LSBs)
The provisions of the Banking Act do not require LSBs to identify and report Abandoned Property.
However, LSBs are requested to identify the articles that could be considered abandoned as described
in Section 72 of the Banking Act and to report them to CBSL using the format at Annex 1.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  259
Instructions for completing the Report of Abandoned Property at Annex 1
Information should be recorded in alphabetical order of the owners’ last name, to the extent possible, and
branchwise. A separate sheet should be used for Minors accounts.
Name of Bank: Enter the name of the reporting bank.
Reporting Date: Enter the date as at when the reporting is done.
Column A:  Enter the owner’s last name followed by full first name and full middle name/s.
Enter information that would aid in identification such as Miss, Mr., Mrs., after the
middle name.
 If a single item has two or more owners, the names of all such owners must be reported
with the relationship.
 If your records do not show an owner name for an item, enter the owner as “unknown”.
Column B:  Enter the complete address available in your records. If no address is available indicate
so. In the case of several owners if the address is same, the address may be entered once
and indicated that it is same for others.
Column C:  Enter the owner’s National Identity Card No., Passport No., date of birth or any other
information that will assist in identification of an owner. These will be essential in paying
claims and if known, they must be included in the Report.
Column D:  Enter the description of item with sufficient detail.
Column E:  Enter your identification number for each item such as Account No., Cheque No. etc.
Column F:  Indicate whether the item is interest bearing.
Column G:  Indicate the date when the last deposit, withdrawal or contact was made by the owner.
It could also be the date a dividend became payable, cheque or draft was issued, certificate
was purchased.
Column H:  Indicate the nature of the last activity .
Column I:  Indicate the total amount due to the owner including all interest, dividend, earned up to
the reporting date without deducting any service charges.


the reporting date without deducting any service charges.
 In the case of safe deposit boxes or other items held for safekeeping, identify the contents
and include the description of any item that has a value. For all safe deposit boxes include
an inventory sheet as in Annex3.
Column J:  Enter the amount of deductions made which should include only any lawful char ges.
Column K:  Indicate the nature of deduction made such as service char ges, tax etc.
Column L:  Indicate the net amount due after the deductions mentioned.
Column M:  Indicate the terms agreed with the owner such as interest rate, payment instructions etc.,
that will be essential in case of payment of claims.
 Also indicate any special considerations attached to such property and the date of maturity
in case of term deposits.
Total:  T otal the Column L and enter at the bottom of each page. On the last page enter the page
total and the grand total for the entire Report.


260 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex 3
Safe Deposit Box Inventory Sheet
Name of Bank:  …………………………………………………………………………………………
Reporting Year:  …………………………………………………………………………………………
Name of Box Owner(s):  ………………………………………………………………………………
Box Number: …………………  Date Drilled: …………………  Vault Location: ……………..
Quantity Detailed Description of Contents Any other Relevant Information
We certify that the above information is true and that no items have been removed or destroyed.
Date of Inventory:
 --------------------------------  ---------------------------------  ------------------------------
 Signatur e of Bank Official  Name of Official  Designation
 --------------------------------  ---------------------------------  ------------------------------
 Signatur e of Bank Official  Name of Official  Designation
Instructions for completing the Safe Deposit Box Inventory Sheet at Annex 3
Name of Bank: Enter the name of the reporting bank.
Reporting Date: Enter the date as at the date of reporting.
Name of the Box Owner(s):  Indicate the full name(s) of the owner(s) including information useful for
owner identification.
Box Number: Enter the safe deposit box number.
Date Drilled: Enter the date the safe deposit box was opened.
Vault Location: Indicate where the vault containing the safe deposit is located.
Quantity & Detailed Description:  Indicate the nature of each item contained in the safe deposit box
with the quantities.
Date of Inventory: The date on which the inventory was taken.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  261
Ref. No. : BS/38/90
Bank Supervision Department
Central Bank of Sri Lanka
8th Floor – Renuka Building
41 Janadhipathi Mawatha
Colombo 1.
30 April 1998.
To : All Licensed Specialised Banks
Dear Sir,
LIST OF QUALIFIED AUDITORS
S.38a OF THE BANKING ACT NO. 30 OF 1988 AS AMENDED BY ACT NO. 33 OF 1995
We refer to section 38 a of the Banking Act, No. 30 of 1988 as amended by Act, No. 33 of 1995 and
enclose herewith a list of qualified  auditors compiled in accordance with S.38 a(1) of the Act.
Your attention is drawn to S.38 a (2) and S.39(1) of the Act which requires that the appointment
of an auditor to audit  the accounts of your Bank from the list transmitted to you under S.38 a (1) by the
Director of Bank Supervision.
You are required to comply with this provision when you next appoint an auditor in terms of S.39
of the Banking Act, No.30 of 1988 as amended by Act, No.33 of 1995.
Please acknowledge receipt of this letter.
Yours faithfully,
Sgd. Y. A. Piyatissa
Director of Bank Supervision


262 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
List	of	Qualified 	Auditors
S.38 a (1) of the Banking Act, No. 30 of 1988 as amended by Act, No.33 of 1995
 Name  Addr ess
 1. Ernst & Young  201 De Saram Place
  P.O. Box 101
  Colombo 10.
 2. K P  M G Ford Rhodes Thornton & Co.  32A Sir Mohamed Macan Marker Mawatha
  P.O. Box 186
  Colombo 3.
 3. Pricewaterhouse Coopers  P.O. Box 918
  100, Braybrooke Place
  Colombo 2.
 4. SJMS Associates  2 Castle Lane
  Colombo 4.
 5. H L  B Edirisinghe & Co.  45 Braybrooke Street
  Colombo 2
 6. B R de Silva & Co.  22/4 Vijaya Kumaratunga Mawatha
  Colombo 5.
 7. Kreston MNS & Co.  P.O. Box 210
  50/2 Sir James Peiris Mawatha
  Colombo 2.
 8. BDO Hathy  ‘Charter House’
  65/2
  Sir Chittampalam A Gardiner Mawatha
   P.O. Box 962
  Colombo 2.
 9. B V Fernando & Co.  78-3 1/1 Rodney Street
  Colombo 8.
10. T issa Fernando  519/2B Elvitigala Mawatha
  Colombo 5.


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  263
Ref. No. : 02  / 05 /006 / 0100  / 002
Bank Supervision Department
17 June 2011
To : CEOs of All Licensed Banks
Dear Sir / Madam,
DISPLAY OF INTEREST RATES, EXCHANGE RATES,
SERVICE CHARGES, FEES AND COMMISSIONS
Reference Circular No. 02/05/006/0100/001 dated 28 October 2003 on display of interest rates
and exchange rates.
To further improve the market efficiency by promoting healthy competition among banks, all
licensed banks are required to expand the disclosures on interest rates of deposits and lending products,
exchange rates and to display details of fees, commissions and other service charges in all branches and
other banking outlets and publish them in banks’ web sites, commencing from 01 August 2011.
Formats for display of above information are enclosed herewith. Banks may further expand the
formats given to suit the products and services of each bank.
Annex I  :  Format for display of interest rates
Annex II  :  Format for display of foreign exchange rates
Annex III  :  Format for display of service char ges, fees and commissions
Yours faithfully,
(Mrs.) T M J Y P Fernando
Director of Bank Supervision


264 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex  I
Suggested format for the Display of Interest Rates
DescriptionMin. rate
as at …..Max. rate
as at …..
Interest Rates on Deposits
Savings Deposits
Minor Savings Deposits
Call Deposits
Time Deposits - 1 Year
    * Interest Payable monthly
    * Interest Payable at maturity
NRFC Savings Deposits
    * US Dollar
    * Sterling Pound
    * Euro
    * Any other currencies
NRFC Fixed Deposits - 1 Year
    * US Dollar
    * Sterling Pound
    * Euro
    * Any other currencies
Interest Rates on Advances
Export Bill Finance - Rupee Facilities
Import Bill Finance - Rupee Facilities
Lease Finance
Lending to Small & Medium Scale Industries (SMEs)
Residential Housing
Pawning
US Dollar Loans to Exporters
Overdrafts
    * Permanent
    * Temporary
Personal Loans
Vehicle Loans
Credit Cards
Agricultural Lending
Refinance 	Schemes
  i.  Agriculture & Animal Husbandry
      * Tea Development Project (Revolving fund)- (TDPRF)
      * Agro – Livestock Development Project
      * Any other
 ii.  Small & Medium Enterprises Sector
      * Susahana Loan Scheme
      * Self-Employment Initiative Loan Scheme
      * Any other
iii. Micro Finance Sector
    * Poverty Alleviation Microfinance Project (Revolving Fund)  PAMP Scheme
    * Small Farmers & Landless Credit Project Revolving Fund
    * Any other


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  265
Annex  II
Suggested format for the Display of Foreign Exchange Rates
Exchange RatesRate: Rupees per unit of foreign currency as at ………….
Currency Travelers Cheques Telegraphic TransfersImport
Bill
RatesBuying
RateSelling
RateBuying
RateSelling
RateBuying
RateSelling
Rate
Australian Dollar
Canadian Dollar
Danish Kroner
Euro
Hong Kong Dollar
Japanese Yen
New Zealand Dollar
Norwegian Kroner
Pound Sterling
Singapore Dollar
Swedish Kroner
Swiss Franc
United States Dollar


266 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex  III
Suggested format for the Display of Service Charges, Fees & Commissions
Description Rs.   as at ……..
SERVICE CHARGES
Savings Accounts
Charges for non-maintenance of account balance as stipulated minimum, etc…
Current Accounts
Current account monthly service charge
Charges for account statement
Cheque issuing cost
Stop payment order
Return cheques due to insufficient funds, etc…
Remittances
Inward credit to Sri Lanka rupee account
Inward remittance to foreign currency account
Issue of foreign currency demand draft, pay orders, etc…
Traveller’s Cheques
Encashment of Traveller’s Cheques
Sale of Traveller’s Cheques, etc.…
ATMs
Issuing Fee
ATM cash withdrawal - Own Bank
ATM cash withdrawal - Other Bank, etc.…
Credit Cards - Main Cardholder
Annual fee
Late Payment charges
Interest charges, etc. …
FEES & COMMISSIONS
SLIPS Payment Charges
RTGS Payment Charges
Facility Arrangement Fees - Overdrafts
    * Security Backed
    * Clean Basis
Early Settlement Fees
    * Residential Housing
    * Vehicle Loans
Cheque Purchase Commission
LC Commission
    * LC Opening Fee & Commission
    * LC Negotiation Charges, etc. …
Shipping Guarantees
Bank Guarantees
Acceptance


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  267
Ref.  No. : 02  / 05 / 006 / 0100  / 001
Bank Supervision Department
28th October 2003
To : All Licensed Commercial Banks and
        Licensed Specialised Banks
Dear Sir  / Madam,
DISPLAY OF INTEREST RATES AND EXCHANGE RATES
The Central Bank of Sri Lanka welcomes the efforts made by banks to publish their deposit and
lending rates. You would no doubt appreciate that adequate market information is vital for improving
market efficiency and in promoting healthy competition.
As another step forward in this direction, all licensed commercial banks and specialised banks
are requested to compile a representative list of their interest rates on deposits and advances and their
buying and selling rates for foreign currencies and to display such information to the general public in
all branches and other banking outlets. You would recall that we agreed at an earlier Bank Managers’
Meeting to follow this practice, but it is observed that not all banks adequately do so.
All licensed commercial banks and specialised banks are informed that the display of interest rates
and exchange rates of banks should commence from 1st January, 2004 the latest. A format suggested
for the display of information is enclosed herewith.
Please forward a copy of the list of interest rates and exchange rates displayed to this Department
periodically as and when it is revised.
Yours faithfully,
Director of Bank Supervision
Suggested Format for the Display of Interest Rates and Exchange Rates
Bank ………………………………
Interest Rates on Deposits [per cent per annum]  Rate as at ……
Savings Deposits
 Fixed Deposits - 12 months
  Interest payable monthly
  Interest payable at maturity
 NRFC Savings Deposits - US Dollar
              - Sterling Pound
 NRFC One Year Fixed Deposits - US Dollar
                - Sterling Pound

Interest Rates on Advances [per cent per annum]  Rate as at ……


- Sterling Pound

Interest Rates on Advances [per cent per annum]  Rate as at ……
Export Bill Finance - Rupee Facilities
Import Bill Finance - Rupee Facilities
Lease Finance
Lending to Medium Scale Industries (up to 5 years)
Residential Housing
Pawning
US Dollar Loans to Exporters
 Rate : Rupees per unit of Foreign Currency as at ………
    Exchange Rates  Currency  Traveller’s Cheques
 Buying Rate  Selling Rate  Buying Rate  Selling Rate
US Dollar
Sterling Pound
Yen
Euro
Australian Dollar
Singapore Dollar
Indian Rupee


268 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Ref. No. : 02  / 04 / 003 / 0401  / 001
Bank Supervision Department
24 March 2006
To :  CEOs of Licensed Commer cial Banks and
   CEOs of Licensed Specialised Banks
Dear Sirs,
INADEQUATE  / INCORRECT DISCLOSURES  / PRESS STATEMENTS BY BANKS
As intimated to you at the Chief Executive Officers meeting held on 23 March 2006, there have
been several instances where banks have attempted to mislead the public by publishing incorrect
statements/data or by not publishing certain aspects of information with regard to non-compliance with
statutory regulations.
Such attempts by banks to mislead the general public totally negate the efforts of the regulator to
educate the public on the true state of the banks in the industry, and it would be futile to further enhance
our efforts in this regard, if immediate action is not taken by the regulator to stop such deception. The
Central Bank of Sri Lanka (CBSL) will be faulted for permitting the banks to misrepresent their financial
condition to the public.
It is incumbent on bank management, in the discharge of their fiduciary responsibility, to project the
true picture of their financial condition to the public.
Therefore, in the interest of providing accurate information to the public for making informed
decisions, all banks are required, in making statements to the press, and in publishing the financial results
of banks, to ensure that adequate publicity is given to non-compliance, if any, with the prudential ratios
and the measures being taken by the bank to meet these ratios.
Where banks, which are not compliant with regulatory requirements, do not make such disclosures
to the public in press interviews or statements, the CBSL, as the regulator will be compelled to correct
such information in the public domain.
Yours faithfully,
Sgd, Director of Bank Supervision
Copy to : Secretary-General, SLBA


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  269
Ref. No. : 02  / 04 / 003 / 0401  / 001
Bank Supervision Department
21 February 2006
To :  The CEOs of all Licensed Commer cial Banks and
   Licensed Specialised Banks
Dear Sirs,
PUBLICATION OF AUDITED FINANCIAL STATEMENTS OF BANKS IN THE PRESS
Further to the circulars issued with regard to the publication of financial statements of banks in the
press, dated 30 September 2005 and 26 January 2006.
Considering the representations made by the banks with regard to the practical difficulties faced by
them with regard to the time period for publication of audited financial statements of banks in the press,
in order to qualify for exemption from publishing the last quarter unaudited results, all licensed banks
are informed as follows:
o If the bank publishes its annual audited financial statements within three months from the end
of the financial year, the requirement to publish the financial statements for the fourth quarter
in terms of the circular dated 30 September 2005 would not be mandatory.
o The licensed commercial banks incorporated abroad may publish the latest available key
performance indicators relating to the global operations of such bank on a quarterly basis, and
the ratios based on audited financial information along with the audited financial statements
of the parent bank.
o W ith regard to the format for publication of audited financial statements, all banks should use
the format issued on 30 September 2005 for the publication of quarterly financial statements.
Yours faithfully,
Sgd, Director of Bank Supervision
(Formats referred to in the Circular are replaced with Circular No. 02/17/900/0001/04 dated 11.02.2013)


270 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Ref. No. : 02  / 04 / 003 / 0401  / 001
Bank Supervision Department
26 January 2006
To : CEOs of all Licensed Banks
Dear Sirs,
PUBLICATION OF QUARTERLY FINANCIAL STATEMENTS OF BANKS
IN THE PRESS
By circular No. 02/04/003/0401/001 dated 30 September 2005, all banks were informed of the
requirements with regard to the publication of quarterly financial statements of banks in the press, which
was applicable for the publication of financial statements from the 3rd Quarter of 2005 onwards.
Several discrepancies were observed with regard to the publications in respect of the 3rd Quarter of
2005. Therefore all banks are informed that they should comply with all the requirements in the above
circular. The following points should be noted:
 1. The time frame for publication is within two months from the end of each quarter .
 2. The publication should be made in a Sinhala, English and Tamil daily newspaper – This
requirement is to inform the public of the financial condition of the banks and is uniformly
applicable to all banks.
 3. The format specified by the circular should be conformed to. If a ‘ nil’ balance has to be
reported in respect of an item in the format, such items should be reported as ‘ nil’, instead
of deleting the entire row from the format.
 4. The key performance indicators should be computed according to the definitions provided
by the BSD.
With regard to the publication of accounts by licensed commercial banks incorporated abroad, the
publication of global accounts is mandatory on an annual basis, while the banks may publish information
relating to the latest available period on a quarterly basis. However, all such banks should publish
quarterly, the selected performance indicators such as capital adequacy ratio, return on assets, return on
equity, and the non-performing advances ratio of the parent bank for the respective quarter.
Yours faithfully,


Yours faithfully,
Sgd, Director of Bank Supervision


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  271
Ref. No. : 02  / 04 / 003 / 0401  / 001
Bank Supervision Department
30 September 2005
To : The CEOs of all Licensed Commercial Banks and
        Licensed Specialised Banks
Dear Sirs,
PUBLIC DISCLOSURE BY PUBLICATION OF
QUARTERLY FINANCIAL STATEMENTS OF BANKS IN THE PRESS
 As discussed at the meeting of the CEOs of LCBs held on 28 July 2005, the format for publication
of quarterly financial statements in the press has been revised in consultation with the representative of
banks, and is attached herewith, along with the suggested Sinhala and Tamil translations.
2. T he revision is aimed at increasing the transparency of banking operations, and to align the
publication requirements with those of other regulators. Accordingly, the formats have been drafted
incorporating the disclosure requirements of the Securities and Exchange Commission (SEC)
(in respect of listed banks) and the Sri Lanka Accounting Standards, as far as possible. In addition,
selected performance indicators, including key prudential ratios have been included, as agreed with the
banks.
3. T he information published should be in respect of the entire bank, i.e. including the off-shore
banking unit and in the case of LCBs incorporated in Sri Lanka, any branches abroad.
4. The new format contains two parts viz;
• Part  I : The format for the summarized balance sheet, income statement, and the statement of
changes in equity and reserves and selected performance indicators.
• Part II :  Instructions for Preparation of Bank Accounts for publication in the press .
5. Balance Sheet information should be reported as at end of the relevant quarter. Comparative figures
to be published should be based on the audited financial statements for the previous financial year .
5.1 The reporting period in respect of the income statement should be the cumulative position as at the


end of the relevant quarter in the financial year. Comparative figures should be in respect of the same
reporting period in the previous financial year.
5.2 In the case of selected performance indicators, the relevant ratios as at the reporting date should be
reported while the comparative ratios should be based on the audited financial statements for the previous
financial year.
6. The publication should be made within two months from the end of each quarter, at least once in
an English, Sinhala and Tamil newspaper.  If the bank publishes its annual audited financial statements
within two months from the end of the financial year, the requirement to publish the financial statements
for the fourth quarter in terms of these instructions would not be mandatory.


272 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
7. The licensed commercial banks incorporated abroad may report information pertaining to
the global operations of the parent bank, in the column for reporting the information on the Group.
Such information may be reported in the currency of the home country or in US Dollars. In view of
the heterogeneous character of group accounts of foreign banks, the banks are requested to make every
endeavour to publish all items given in the agreed format.
8. The disclosure requirements contained herein specify the minimum requirements to be adopted
by the banks and all banks are encouraged to make additional disclosures for the benefit of the general
public. In addition, the banks listed on the Colombo Stock Exchange should comply with any additional
regulations imposed by the SEC with regard to publication of financial information.
9. The revised publication format will be effective for publication of banks’ financial statements from
the 3rd quarter of 2005 onwards.
9.1 The codes indicated in the formats are for cross reference with the definitions in the instructions and
not for publication.
10. The circular dated 30 January 2003 on the publication of quarterly financial statements is hereby
rescinded.
 Please acknowledge receipt of this circular .
Yours faithfully,
Sgd, Director of Bank Supervision


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  273
Our Ref. : 02  / 17 / 900 / 0001  / 04
Bank Supervision Department
11 February 2013
To : CEOs of all Licensed Commercial Banks and
       Licensed Specialised Banks
Dear Sir / Madam,
PUBLIC DISCLOSURE BY PUBLICATION OF
QUARTERLY FINANCIAL STATEMENTS OF
BANKS IN THE PRESS
We refer to our previous correspondence and discussions on the above and enclose the
new format for the publication of quarterly financial statements of licensed commercial banks and
licensed specialised banks in the press effective from the 1st quarter of 2013.
Accordingly, format referred to in the paragraph No. 4 of the Circular dated 30 September 2005
on the above is replaced with the format in Annex.
Yours faithfully,
(Mrs.) T M J Y P Fernando
Director of Bank Supervision
Encl.
Copy to :  The Secretary-General, Sri Lanka Banks’  Association (Guarantee) Ltd.


274 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
Annex
SPECIFIED FORMAT FOR THE PUBLICATION OF
QUARTERLY FINANCIAL STATEMENTS OF
LICENSED COMMERCIAL BANKS AND LICENSED SPECIALISED BANKS
IN THE PRESS
………….. BANK
INCOME STATEMENT
FOR THE PERIOD ENDED ………….
In Rupees Thousands
Bank Group
Current
PeriodPrevious
PeriodCurrent
PeriodPrevious
Period
From
DD/MM/YY
To
DD/MM/YYFrom
DD/MM/YY
To
DD/MM/YYFrom
DD/MM/YY
To
DD/MM/YYFrom
DD/MM/YY
To
DD/MM/YY
Interest income
Interest expenses
Net interest income
Fee and commission income
Fee and commission expenses
Net fee and commission income
Net gain / (loss) from trading
Net gain / (loss) from financial instruments
  designated at fair value through
  profit or loss
Net gain / (loss) from financial investments
Other operating income (net)
Total operating income
Impairment for loans and other losses
 Individual impairment
 Collective impairment
 Others
Net operating income
Personnel expenses
Depreciation and amortisation
Other expenses
Operating profit/(loss)
 befor e value added tax (V AT)
Value added tax (V AT) on financial services


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  275
Bank Group
From
DD/MM/YY
To
DD/MM/YYFrom
DD/MM/YY
To
DD/MM/YYFrom
DD/MM/YY
To
DD/MM/YYFrom
DD/MM/YY
To
DD/MM/YY
Profit / (loss) for the period
Other comprehensive income, net of tax
Changes in revaluation surplus
Actuarial gains and losses on
defined benefit plans
Gains and losses
(arising from translating the financial
statements of a foreign operation)
Gains and losses on re-measuring
available-for-sale financial assets
Gains and losses on cash flow hedges
Others
Share of profits of associates
and joint ventures
Less: T ax expense/(income) relating to
components of other comprehensive
income
Other comprehensive income for the
period, net of taxes
Total comprehensive income for the period
Attributable to:
Owners of the parent
Non-controlling interests………….. BANK
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED ………….
In Rupees ThousandsOperating profit/(loss)
  after value added tax (V AT)
Share of profits of associates and
  joint ventures
Profit/(loss) before tax
Tax expenses
Profit/(loss) for the period
Profit attributable to:
Owners of the parent
Non-controlling interests
Earnings per share on profit
Basic earnings per ordinary share
Diluted earnings per ordinary share(Contd.)


276 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
………….. BANK
STATEMENT OF FINANCIAL POSITION
AS AT ………….
In Rupees Thousands
Bank Group
Current
PeriodPrevious
PeriodCurrent
PeriodPrevious
Period
As at
DD/MM/YYAs at
DD/MM/YYAs at
DD/MM/YYAs at
DD/MM/YY
Assets
Cash and cash equivalents
Balances with central banks
Placements with banks
Derivative financial instruments
Other financial assets held-for-trading
Financial assets designated at fair value
 through profit or loss
Loans and receivables to banks
Loans and receivables to other customers
Financial investments – Available-for-sale
Financial investments – Held-to-maturity
Investments in subsidiaries
Investments in associates and joint ventures
Property, plant and equipment
Investment properties
Goodwill and intangible assets
Deferred tax assets
Other assets
Total assets
Liabilities
Due to banks
Derivative financial instruments
Other financial liabilities held-for-trading
Financial liabilities designated at fair value
 through profit or loss
Due to other customers
Other borrowings
Debt securities issued
Current tax liabilities
Deferred tax liabilities
Other provisions
Other liabilities
Due to subsidiaries
Subordinated term debts
Total liabilities


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  277
………….. BANK
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED ………….
BANK / GROUP  In Rupees Thousands
Stated capital/
Assigned
capitalReserves
Total
Non-controlling interest
Total equityOrdinary
voting shares
Ordinary
non-voting shares
Assigned capital
Reserve fund
Revaluation reserve
Retained earnings
Other reserves
Balance as at DD/MM/YY (Opening balance)
Total comprehensive income for the year
Profit/(loss) for the year
Other comprehensive income (net of tax)
Total comprehensive income for the year
Transactions with equity holders, recognised
directly in equity
Share issue/increase of assigned capital
Share options exercised
Bonus issue
Rights issue
Transfers to reserves during the period
Dividends to equity holders
Profit transferred to head office
Gain/(loss) on revaluation of Property, Plant
and Equipment (if cost method is adopted)
Others (Please specify)
Total transactions with equity holders
Balance as at DD/MM/YY (Closing balance)           (Contd.)
Equity
Stated capital/Assigned capital
Statutory reserve fund
Retained earnings
Other reserves
Total shareholders’ equity
Non-controlling interests
Total equity
Total equity and liabilities
Contingent liabilities and commitments
Memorandum Information
 Number of Employees
 Number of Branches
Note: Amounts stated are in net of impairment and depreciation


278 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
………….. BANK
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED ………….
In Rupees Thousands
Bank Group
Current
PeriodPrevious
PeriodCurrent
PeriodPrevious
Period
DD/MM/YY DD/MM/YY DD/MM/YY DD/MM/YY
Cash	flows	from	operating 	activities
Profit before tax
Adjustment for :
Non-cash items included in profits before tax
Change in operating assets
Change in operating liabilities
Net gains from investing activities
Share of profits in associates and joint ventures
Dividend income from subsidiaries and associates
Interest expense on subordinated debt
Others (please specify)
Contribution paid to defined benefit plans
Tax paid
Net cash generated from operating activities
Cash	flows	from	investing	activities
Purchase of property, plant and equipment
Proceeds from the sale of property, plant and equipment
Purchase of financial investments
Proceeds from the sale and maturity of financial
investments
Net purchase of intangible assets
Net cash flow from acquisition of investment
in subsidiaries and associates
Net cash flow from disposal of subsidiaries
Proceeds from disposal of associates and joint ventures
Dividends received from investment
in subsidiaries and associates
Others (please specify)
Net cash (used in)/from investing activities
Cash	flows	from	financing	activities
Net proceeds from the issue of ordinary share capital
Net proceeds from the issue of other equity instruments
Net proceeds from the issue of subordinated debt
Repayment of subordinated debt
Interest paid on subordinated debt
Dividend paid to non-controlling interest
Dividend paid to shareholders of the parent company
Dividend paid to holders of other equity instruments
Others (please specify)
Net	cash	from	financing	activates
Net increase/(decrease) in cash & cash equivalents
Cash and cash equivalents at the beginning of the period
Exchange difference in respect of cash & cash equivalent


Exchange difference in respect of cash & cash equivalent
Cash and cash equivalents at the end of the period
Note:   Banks have the option to use one of the two methods specified in LKAS 7
for the preparation of the statement of cash flows


Directions, Determinations, and Circulars issued to Licensed Specialised Banks  279
………….. BANK
ANALYSIS OF FINANCIAL INSTRUMENTS BY MEASUREMENT BASIS
AS AT ………….
In Rupees Thousands
a. Bank – Curr ent period
HFTDesignated
at fair
valueHTMAmortised
costAFS Hedging Total
ASSETS
Cash and cash equivalents
Balances with central banks
Placements with banks
Derivative financial instruments
Other financial assets at
 fair value through profit or loss
Loans and receivables to banks
Loans and receivables to
 other customers
Financial investments
Total financial assets
HFTDesignated
at fair valueAmortised
costHedging Total
LIABILITIES
Due to banks
Derivative financial instruments
Other financial liabilities at
 fair value through profit or
loss
Due to other customers
Other borrowings
Debt securities issued
Total financial liabilities
HFT  –  Held for trading
Designated at fair value  –  Designated at fair value through profit or loss
Amortised cost  –  Loans and receivables/deposits at amortised cost
HTM  –  Held-to-maturity
AFS  –  Available-for-sale
Hedging  –  Instruments of fair value and cash flow hedging
b. Bank – Pr evious period as above
c. Gr oup – Current period as above
d. Gr oup – Previous period as above


280 Directions, Determinations, and Circulars issued to Licensed Specialised Banks
………….. BANK
SELECTED PERFORMANCE INDICATORS (AS PER REGULATORY REPORTING)
AS AT ………….
ItemBank Group
DD/MM/YY DD/MM/YY DD/MM/YY DD/MM/YY
Regulatory Capital Adequacy
Core Capital (Tier 1 Capital), Rs. ’000
Total Capital Base, Rs. ’000
Core Capital Adequacy Ratio, as % of Risk Weighted
 Assets (Minimum Requirement, 5%)
Total Capital Adequacy Ratio, as % of Risk Weighted
 Assets (Minimum Requirement, 10%)
Assets Quality (Quality of Loan Portfolio)
Gross Non-Performing Advances Ratio, %
 (net of interest in suspense)
Net-Non Performing Advances, %
 (net of interest in suspense and provision)
Profitability
Interest Margin, %
Return on Assets (before Tax), %
Return on Equity, %
Regulatory Liquidity
Statutory Liquid Assets, Rs. ’000
Statutory Liquid Assets Ratio, %
 (Minimum Requirement, 20%)
Domestic Banking Unit
Off-Shore Banking Unit
CERTIFICATION :

We, the undersigned, being the Chief Executive officer and the Financial Controller / Compliance Officer of
…………………… Bank certify jointly that:
 (a)  the above statements have been prepared in compliance with the format and definitions pre -
scribed by the  Central Bank of Sri Lanka;
 (b)  t he information contained in these statements have been extracted from the unaudited financial
statements of the bank unless indicated as audited.
 (Name )  (Name)
 (Sgd.) Chief Executive Officer   (Sgd.) Financial Controller or Compliance Officer
 Date: DD/MM/YY   Date: DD/MM/YY