'Finance Business Act has strengthened powers of banking regulatory body'

The Merchant Bank of Sri Lanka PLC (MBSL) organised a seminar on "Implications of the new Finance Business Act" in Colombo recently, a MBSL media release said.

The guest speaker was Dr. Dayanath Jayasuriya, PC. More than 200 participants from the corporate sector, individuals and professionals in various disciplines attended. He spoke on The Concepts of Finance Business and Deposits, Powers of the Regulator, Duties of Directors, Auditors and the Senior Management, Impact on related entities, Need for more effective Corporate Governance and to address conceptual and operational issues and problems.

Since the risk of a collapse of financial institutions cannot be totally eliminated, implementing proper processes and procedures to prevent deviation and a 'zero tolerance policy' in respect of illegal operations and mismanagement will make the business environment less vulnerable to risks.

"The need to amend the Finance Companies Act which was enacted 20 years ago has been felt by the financial sector and the public.

It is necessary to augment the supervisory powers in respect of licensed finance companies to curb unauthorised deposit taking by individuals and institutions. The new Finance Business Act No. 42 of 2011 has strengthened the powers of Sri Lanka's banking regulatory body - The Central Bank of Sri Lanka to protect depositors and institutions. This Act provides the Central Bank of Sri Lanka with more authority to regulate the banking and finance industry.