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BACKGROUND STUDY OF BANKING INDUSTRY

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BACKGROUND STUDY OF BANKING INDUSTRY The central bank of Sri Lanka's banking supervision department has elaborated following regarding the institutions permitted by the central bank to accept deposits. There are three major categories of institutions that are subject to licensing and regulations and supervision by the central bank in  public  interest because they accept deposits from the general public. They are Licensed Commercial Bank Licensed Specialize Bank Registered Finance Companies Licensed Commercial Banks Licensed Commercial Banks maintain current accounts for customers, where money could be transferred by cheque and  withdrawn on demand. they also maintain saving accounts, in addition they undertake a wide range of financial services and deal in foreign currency. The 26 Licensed Commercial Banks and total of more than 6180 branches currently operating in the country. These banks are regulated and supervised by the central bank of Sri Lanka...
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CENTRAL BANK OF SRI LANKA

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 CENTRAL BANK OF SRI LANKA  Introduction to CBSL Established in 1950 under the Monetary Law Act No.58 of 1949 (MLA), the Central Bank of Sri Lanka (CBSL) is the apex institution in the financial sector in Sri Lanka The Central Bank of Ceylon was set up by the post-independence Government in recognition of the importance of an active monetary policy regime and a dynamic financial sector to support and promote economic growth The Central Bank was given wide powers to administer and regulate the entire money, banking and credit system of the country. The Central Bank was also given the sole right and authority to issue currency and it became the custodian of the international reserves of the country. The objectives of the Central Bank    The stabilization of domestic monetary values (maintenance of price stability).   The preservation of the par value or the stability of the exchange rate of the Sri Lankan Rupee The...
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FINANCIAL INTERMEDIATION

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Concept of Financial Intermediation                  Suppose you want to start a restaurant and at the same time , a woman name urshula, who lives in another state, has money to invest in a start-up business. if you and urshula could somehow cross paths, she could invest in your business and you could fulfill your dream of entrepreneurship. since you probably would never find urshula on your own. because she lives in another state, there's a process called financial intermediation that can ensure both of you meet your goals.  According to this example the basic idea of financial intermediation; connect borrowers with savers; these intermediates help channel funds from one person, or entity to another. Borrowers and Savers There are two main roles in the financial intermediation process; borrowers also known as spenders and savers also called lenders,let's look at who's borrowers and savers. Borrowers   - Borr...
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