Sri Lanka’s banking sector has issued a collective assurance that it remains stable, resilient and secure despite a few recent isolated incidents of financial fraud, emphasising that these developments do not threaten the safety of customer deposits or the integrity of the financial system.
In a statement, the Sri Lanka Banks’ Association (SLBA), which represents all licensed commercial banks, said it was addressing the matters comprehensively and was well equipped to manage and mitigate the challenges. It acknowledged that the incidents had understandably generated concern, while underscoring the strength of the sector’s fundamentals and the effectiveness of ongoing regulatory oversight and risk management.
“Recent reports of financial fraud and cyber-related incidents have understandably received public attention. Industry leaders and regulators emphasise, however, that the banking sector remains fundamentally strong, resilient, and well equipped to withstand such challenges without compromising its core stability or the security of customer deposits,” SLBA Chairman Sanath Manatunge said. He noted that many social media posts on the subject were misleading or carried inaccurate information.
Manatunge conceded that recent cases of electronic fund transfer fraud had raised questions about digital security, but said such losses were being absorbed through the banks’ institutional capital buffers rather than from public deposits. The Association said the incidents did not reflect systemic weaknesses across the industry, while adding that banks would nonetheless carry out an in-depth review of their operational processes to safeguard integrity.
The reassurance follows a run of high-profile incidents that have unsettled public confidence, including the NDB fraud disclosure — which prompted a Fitch downgrade of the bank — and a Rs. 656 million exchange-rate error at People’s Bank. The Central Bank has repeatedly stated that the wider system remains sound and depositor funds are safe.
