The Central Bank of Sri Lanka has cancelled the finance business licence of Nation Lanka Finance PLC with effect from July 3 and will proceed to wind up the company under the Banking (Special Provisions) Act, No. 17 of 2023.
CBSL said the company had been placed under administration on July 4, 2025 after continuous violations of the Finance Business Act despite repeated regulatory interventions. Over the past year the regulator explored restructuring options, sought acquisitions by other licensed banks and finance companies and invited potential investors, but none of the efforts produced a viable solution.
“The company’s continued financial deterioration made it necessary to cancel its licence and begin liquidation in the interest of depositors and other stakeholders,” CBSL said.
Under the Sri Lanka Deposit Insurance Scheme, insured depositors will receive compensation of up to Rs. 1.1 million each. CBSL said this would fully compensate roughly 99.1% of the company’s depositors. The remaining 0.9% will receive Rs. 1.1 million as a part settlement, with any outstanding balance recovered through the liquidation process subject to the priority of claims.
Further details on the compensation process, including payment dates and procedures, will be announced later. Borrowers of Nation Lanka Finance PLC have been asked to continue settling their dues through bank accounts held in the company’s name.
The move is the second major CBSL wind-up action this cycle, following the cancellation of Cooperative Leasing Company Ltd’s licence in June. Both cases show the regulator using the Banking (Special Provisions) Act, No. 17 of 2023 to close non-viable financial institutions rather than allowing prolonged administration to continue.
