Central Bank (CBSL) governor says the banking system is excluded from the Domestic Debt Restructuring (DDR) process.
Dr. Nandalal Weerasinghe explained that the banking system already contributes to the Treasury and the economy through taxes of over 50%.
Addressing a special media briefing on Domestic Debt Optimization (DDO) held at the Presidential Media Centre this morning (June 29), he assured that the 57 million depositors would be protected.
The CBSL governor stressed on the importance of protecting the banking sector as its collapse can have catastrophic consequences.
Speaking further Dr. Weerasinghe, who reiterated that the Employees’ Provident Fund (EPF) savings already accumulated would not be touched, also guaranteed a minimum 9% interest for EPF.
Under the DDR process, only the Treasury Bills held by the Central Bank will be converted to Treasury Bonds with the new interest rate of 12.4% up until 2024, 7.5% up until 2026 and 5% until maturity, he added.
In response to a question raised by a journalist, the CBSL governor explained that June 30 (Friday) was declared a bank holiday to avoid any undue speculations until the parliament’s approval is received for the proposed DDR process.