{"id":155839,"date":"2026-04-23T14:58:43","date_gmt":"2026-04-23T21:58:43","guid":{"rendered":"https:\/\/www.lankaweb.com\/news\/items\/?p=155839"},"modified":"2026-04-23T14:58:43","modified_gmt":"2026-04-23T21:58:43","slug":"dont-abandon-banks-but-be-selective","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2026\/04\/23\/dont-abandon-banks-but-be-selective\/","title":{"rendered":"Don\u2019t abandon banks\u2014but be selective"},"content":{"rendered":"

Dr Sarath Obeysekera<\/em><\/span><\/h2>\n\n\n

1. Don\u2019t abandon banks\u2014but be selective<\/h2>\n\n\n\n

Licensed commercial banks supervised by theCentral Bank of Sri Lanka are  still far safer than most finance companies<\/strong>.<\/p>\n\n\n\n

That said, don\u2019t treat all banks as equal:<\/p>\n\n\n\n

    \n
  • Prefer systemically important banks<\/strong> (large balance sheets, strong capital)<\/li>\n\n\n\n
  • Look at published financials (capital adequacy, NPL ratios)<\/li>\n\n\n\n
  • Avoid chasing unusually high deposit rates\u2014it\u2019s often a red flagged<\/li>\n\n\n\n
  • Spread your risk (this is the single most important step)<\/strong><\/li>\n<\/ul>\n\n\n\n

    Instead of asking which institution is safest,\u201d assume none are risk-free<\/strong>.<\/p>\n\n\n\n

      \n
    • Split deposits across 2\u20133 strong banks<\/strong><\/li>\n\n\n\n
    • Keep each deposit within the insured limit underSri Lanka Deposit Insurance and Liquidity Support Scheme<\/li>\n\n\n\n
    • (currently LKR 1.1 million per depositor per institution)<\/li>\n<\/ul>\n\n\n\n

      This way, even if one fails, you\u2019re not wiped out.<\/p>\n\n\n\n

      Be cautious with finance companies\u2014don\u2019t treat them like banks<\/strong><\/p>\n\n\n\n

      Licensed finance companies are regulated, but:<\/p>\n\n\n\n

        \n
      • They take higher risks<\/strong><\/li>\n\n\n\n
      • Governance has historically been weaker<\/li>\n<\/ul>\n\n\n\n

        If you must invest:<\/p>\n\n\n\n

          \n
        • Stick only to CBSL-licensed finance companies<\/strong><\/li>\n\n\n\n
        • Limit exposure to a small percentage<\/strong> of your portfolio<\/li>\n\n\n\n
        • Avoid long lock-in periods<\/li>\n<\/ul>\n\n\n\n

          Consider government securities<\/h2>\n\n\n\n

          For capital safety:<\/p>\n\n\n\n

            \n
          • Treasury bills and bonds issued by the Government of Sri Lanka are still considered low risk locally<\/strong><\/li>\n\n\n\n
          • These can be accessed through banks or primary dealers<\/li>\n<\/ul>\n\n\n\n

            Returns may be lower\u2014but stability matters more at your stage.<\/p>\n\n\n\n

             On digitisation\u2014your point is valid, but incomplete<\/h2>\n\n\n\n

            You\u2019re correct: real-time monitoring and red-flag systems should catch fraud early<\/strong>.<\/p>\n\n\n\n

            But the reality:<\/p>\n\n\n\n

              \n
            • Systems exist, but human override, collusion, or weak governance<\/strong> can bypass them<\/li>\n\n\n\n
            • Digitisation doesn\u2019t replace accountability and enforcement<\/strong><\/li>\n<\/ul>\n\n\n\n

              The real failure is not just technology\u2014it\u2019s lack of consequences at senior levels<\/strong><\/p>\n\n\n\n

              A practical allocation strategy (simple and conservative)<\/h2>\n\n\n\n

              Given your concerns and experience:<\/p>\n\n\n\n

                \n
              • 50\u201360% \u2192 Strong licensed banks (spread across 2\u20133)<\/li>\n\n\n\n
              • 20\u201330% \u2192 Government securities<\/li>\n\n\n\n
              • 10\u201320% \u2192 Liquid cash \/ savings Gold coins\u00a0<\/li>\n\n\n\n
              • Minimal or zero \u2192 finance companies unless carefully selected<\/li>\n<\/ul>\n\n\n\n

                Regards

                Dr Sarath Obeysekera<\/p>\n\n\n\n

                <\/p>\n","protected":false},"excerpt":{"rendered":"

                Dr Sarath Obeysekera 1. Don\u2019t abandon banks\u2014but be selective Licensed commercial banks supervised by theCentral Bank of Sri Lanka are  still far safer than most finance companies. That said, don\u2019t treat all banks as equal: Instead of asking which institution is safest,\u201d assume none are risk-free. This way, even if one fails, you\u2019re not wiped out. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[116],"tags":[],"class_list":["post-155839","post","type-post","status-publish","format-standard","hentry","category-dr-sarath-obeysekera"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/155839","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/comments?post=155839"}],"version-history":[{"count":1,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/155839\/revisions"}],"predecessor-version":[{"id":155840,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/155839\/revisions\/155840"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=155839"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=155839"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=155839"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}