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Friday June 9th, 2023

Sri Lanka tightens bank dividends, profit repatriation to preserve capital

ECONOMYNEXT – Sri Lanka’s central bank has ordered banks not to declare dividends and foreign banks not to repatriate profits until 2022 financial accounts are finalized and audited as an economic crisis impacts banks.

“Every licensed bank incorporated or established in Sri Lanka shall defer payment of cash dividends until the financial statements/interim for the year 2022 are finalized and audited by its External Auditor,” the direction issued by the regulator said.

“Every licensed bank incorporated outside Sri Lanka shall defer repatriation of profits not already declared for financial years 2021 and 2022 until the financial statements for the year 2022 are finalized and audited by the External Auditor.”

Banks were also asked not to buy back shares, to use “extreme due diligence and prudence” in capital expenditure and to avoid non-urgent spending.

The central bank said it wanted to ensure that banks had “appropriate levels of liquidity and capital buffers” in the current economic conditions.

Sri Lanka has kept interest low for two years by printing money triggering a monetary meltdown with a soft-pegged rupee falling steeply amid forex shortages.

As interest rates correct banks are facing mark to market losses, possible restructuring losses on sovereign bond holders and bad loans as consumption as the economy and consumption is slowed to save the soft-pegged rupee from collapsing further. (Colombo/May08/2022)

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Sri Lanka’s police, health workers mostly violate rights of LGBTQ community – report

ECONOMYNEXT – Sri Lanka’s law implementing police officials and health workers among the top in violating the rights of lesbian, gay, bisexual, transgender, and queer (LGBTQ), according to a study, citing the complaints at the local Human Rights Commission and police.

A study conducted by Bridge to Equality, a civil rights group concerned over LGBTQ in Sri Lanka, shows that 160 rights violation cases reported to the police out of a total 235  during the 18 month period through March 31, 2023, are involved with police and health sector workers.

The data showed that police have been the perpetrators in 96 rights violation cases, while 64 cases are involved with health workers including medical officers.

“The analysis shows that some LGBTQ persons are reluctant to go to the authorities (such as the Human Rights Commission of Sri Lanka or the Police) due to the existing penal laws and various social stigmas that continues to exist in the society,” the Bridge to Equality said in the conclusion of the report based on the 235 complaints.

“These stigmas may include inaccurate perceptions that LGBTQ persons are psychologically unwell or that it is a trend or ‘lifestyle’ that conflicts with the Sri Lankan culture.”

The human rights violations have been involved with article 12 of the constitution which is involved with equality before the law and protection from discrimination, followed by article 11 which is linked to protection from torture and cruel, inhumane and degrading punishment.

The LGBTQ community also faces unlawful arrest, the report said.

Sri Lanka’s Penal Code, which states that “carnal intercourse against the order of nature” is a criminal offence” makes gayism  and lesbianism against the country’s law.

Meanwhile, the transgender community has been targeted by another section of the Penal Code which criminalises “pretending to be some other person.”

Civil groups such as the Human Rights Watch and iProbono have said that individuals in the LGBTQ+ community have been subjected to forced anal and vaginal exams as well as being subjected to homophobic slurs from hospital staff.

The Health Ministry admitted that its workers have been violating the rights of LGBTQ.

“The LGBTQ+ community has been subjected to physical, verbal and sexual harassment by those in the medical field,” Anwar Hamdani, Director of Tertiary Care Services at the Ministry of Health, told EconomyNext.

Police Spokesman Nihal Thalduwa said only transgender people are legalized in Sri Lanka.

“Others are not legally accepted in the country. That’s how the police get included in this. Take lesbian as an example. There can be some who like it. However, even if there are people who are in favour of that, if some people complain about it, since it is not legally accepted then the police will have to take actions against it,” Thalduwa told EconomyNext.

“Since it is illegal, police will have to act on the existing law.  Police do not have anything against it if that is legal. Maybe because of that there may be a perception saying the police are harassing them. But it is not like the police are going after individuals and harassing them.”

“However, when it comes to transgender issues the Police commissioner has issued circulars asking all police officers to take necessary precautions to not to harm the individuals privacy.”

While the repeal of the Penal Code that criminalizes gayism and lesbianism is currently in the process of being debated in parliament, convictions against those in the community are being carried out by the police.

“Other than a transition between genders, LGBTQ+ activity is unlawful in the country,” Thalduwa said.

“Therefore, those who are against the LGBTQ+ community look to the police to curb these activities. Because of its unlawful nature, convictions are being carried out.” (Colombo/June 08/2023)

 

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Sri Lanka rupee close at 294.50/295.50 to dollar, bond yields up

ECONOMYNEXT – Sri Lanka spot US dollar closed weaker at 294.50/295.50 rupees and the bonds were up on Thursday, dealers said.

The Spot US dollar closed at 291.00/292.00 rupees rupees on Wednesday.

A bond maturing on 15.09.2027 closed at 23.40/60 percent up from 23.10/40 percent a day earlier, dealers said.

A bond maturing on 01.05.2025 closed at 26.75/27.00. percent, up from 26.25/60 percent on Wednesday.

(Colombo/ June 08/2023)

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Sri Lanka’s shares close higher on favorable macroeconomic prospects

ECONOMYNEXT – Sri Lanka’s shares closed higher on Thursday, as investor sentiments picked up on lowered inflation and policy rate cuts, after two consecutive losses in previous sessions due to selling interest and profit taking, an analyst said.

The main All Share Price Index was up 0.52 percent or 45.28 points to 8,767.34, this is the highest the index has been since May 18, while the most liquid index S&P SL20 was up 0.65 percent or 16.05 points to 2,479.87.

The market was seeing gains, due to lowered policy rates and low inflation stimulating buying interest and driving the sentiment up, an analyst said.

Sri Lanka’s inflation in the 12-months to May 2023 has eased to 25.2 percent from 35.3 percent a month earlier according to a revised Colombo Consumer Price Index calculated by the state statistics office.

The central bank cut the key policy rates by 250 basis points to spur a faltering economic growth as inflation was decelerating faster than it projected.

“There are gradual improvements in the market sentiment, with positive sentiments coming in from lowered policy rates and inflation,” an analyst said.

The market generated foreign inflows of 57 million rupees and received a net foreign outflow of 282 million rupees.

The market generated a revenue of 853 million rupees, this is the highest the turnover has been since June 01, while the daily turnover average was 1 billion rupees. From the total generated revenue, the banking sector contributed 120 million rupees, Diversified Banks contributed 115 million rupees and the Capital Goods Industry generated 78 million rupees.

Top gainers during trade were Commercial Bank, Hatton National Bank and Cargills. (Colombo/June06/2023)

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