Colombo, May 11: Sri Lankan banks are struggling to secure dollar funding lines in the midst of the crippling forex crunch in the country and a junk rating.
At least six banks said the funding lines by Development Financial Institutions (DFIs) have saturated or these institutions are waiting on the sidelines to make a pledge after the planned bailout from the International Monetary Fund (IMF).
When the Government is downgraded to default grade, the banks in the country are also routinely placed in the same grade as they cannot get a better rating than the sovereign, WA Wijewardena said.
Economic analysts say the major challenge for banks which have taken funding lines is reimbursing the DFIs while the forex shortage is adding to the problems.
“Now rates are prohibitive and we can’t virtually access any finding lines,” a senior Sri Lankanbanker said.
(UNI)
Follow our WhatsApp channel
