📈 Sri Lanka Private Sector Credit Rebounds in Sept., Though Annual Growth Eases

Provisional Central Bank of Sri Lanka (CBSL) data highlights key developments in banking system credit and monetary aggregates for September 2026: • Overall Credit Breakdown: Net private sector credit grew by Rs. 212.4 Bn MoM (more than double August's Rs. 106 Bn), bringing outstanding credit to Rs. 11.77 Tn. However, monthly expansion remained 6.4% lower than Sept. 2025 (Rs. 226.8 Bn), marking a third consecutive monthly slowdown in YoY private credit growth to 23.6% (down from 24.5% in August and 26.4% in July). • Banking Unit Sector Performance: • Domestic Banking Units (DBUs): Rupee lending expanded by Rs. 171.8 Bn MoM to reach Rs. 11.17 Tn, though YoY growth moderated to 25.0% (from 26.6%). • Offshore Banking Units (OBUs): Foreign currency lending rebounded by Rs. 40.6 Bn MoM to Rs. 597.9 Bn (reversing August's Rs. 33.1 Bn contraction), bringing YoY growth to 2.1%. • Public Sector & Foreign Assets: • Government Credit: Net credit to the government declined by Rs. 84.8 Bn MoM to Rs. 7.65 Tn (-7.6% YoY). • State-Owned Enterprises: Credit to SOBEs fell Rs. 16.9 Bn MoM to Rs. 462.9 Bn (-24.0% YoY). • Net Foreign Assets (NFA): System NFA dropped Rs. 41.9 Bn MoM to Rs. 1.63 Tn (the year's first monthly decline), as commercial bank NFA fell by Rs. 82.2 Bn despite CBSL NFA rising Rs. 40.3 Bn.