Category: Daily Financial Times

As the boundaries between technology, business, leadership and governance continue to converge, the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) will present its flagship 47th National Conference of Chartered Accountants from 7 to 9 October 2026 at the Monarch Imperial, Sri Jayewardenepura Kotte, under the theme ‘FUSION: Connecting Ideas | Creating Impact.’

Announcing the three-day conference at a media briefing on 12 August 2026, CA Sri Lanka President Tishan Subasinghe said the National Conference has evolved into a catalyst for meaningful dialogue and action. ‘Over a period of three days, the 47th National Conference will examine the issues shaping business, our profession and the wider economy. More importantly, it will encourage bold thinking, meaningful dialogue and practical action that can create lasting impact,’ he added.

He made these remarks in the presence of CA Sri Lanka Vice President Anoji de Silva, National Conference Committee Chairman Thivanka Jayasinghe, Alternate Chair Ashane Jayasekara, Technical Committee Chairperson Nishani Perera, Alternate Chair Shyamali Kirinde and Chief Executive Officer Lakmali Priyangika, alongside members of the media, event sponsors and other distinguished guests.

Subasinghe noted that today’s business landscape requires Chartered Accountants not only to respond to change, but to help shape it by connecting perspectives, navigating complexity and contributing to the conversations defining the future. According to Mr. Subasinghe, the National Conference provides a timely platform to examine these challenges, share insights and equip leaders with the thinking needed to thrive in an increasingly interconnected world.

‘We need leaders who think beyond organisational boundaries, professionals who understand both local realities and global developments, and decision-makers who can balance growth with sustainability, innovation with responsibility, and opportunity with risk, without compromising any of them,’ Subasinghe added.

Recognised as one of Sri Lanka’s premier business summits, the National Conference, first held in 1979, has become a leading platform for business thought leadership. Over the years, it has brought together global and local experts, business pioneers, policymakers and professionals to examine emerging trends and discuss practical and strategic solutions relevant to Sri Lanka and beyond.

Jayasinghe said the conference has grown far beyond an annual gathering. ‘Over the years, the National Conference has become one of Sri Lanka’s foremost platforms for business thought leadership, bringing together influential voices that shape the country’s business and professional landscape. This year, we are building on that legacy with a program designed to inspire ideas, collaboration and impact,’ he said.

The conference is expected to attract over 2,500 participants, including C-suite executives, policymakers, senior finance professionals, business leaders, entrepreneurs, mid-level professionals and young Chartered Accountants, with participation available both physically and virtually. ‘While CA Sri Lanka is proud to organise the National Conference, its significance extends well beyond the accounting profession. As Sri Lanka’s premier business summit, it creates opportunities for meaningful dialogue, new partnerships and shared learning. Its true value lies not in the numbers attending, but in the ideas exchanged, the connections formed and the impact generated,’ Jayasinghe added.

The theme reflects the evolving role of Chartered Accountants in an increasingly interconnected, technology-driven world. FUSION represents the integration of knowledge, innovation, technology, leadership and human insight to create meaningful and sustainable value. It highlights the profession’s evolution beyond technical expertise towards broader roles as strategic advisers, innovators, transformational leaders and trusted guardians of organisational value.

By bringing together financial expertise, technology, ethics and business insight, FUSION aims to support better decision-making and stronger organisations. Complementing the theme is the Phoenix, the conference’s visual identity, symbolising renewal, resilience, transformation, growth and the confidence to embrace change.

Perera said the theme reflects both the profession’s evolution and the conference’s ambition to unite diverse perspectives. ‘FUSION represents the purposeful integration of ideas, disciplines, experiences, technologies and perspectives to create stronger, more relevant and enduring value. Through this conference, we aim to bring together distinguished professionals, business leaders, policymakers, entrepreneurs and thought leaders to broaden perspectives, share insights and explore practical responses to the opportunities and challenges shaping our future,’ she said.

The 47th National Conference will feature seven main sessions with over 25 local and international speakers, covering a broad range of topics including situational leadership, entrepreneurship, innovation, personal and corporate wellbeing, the future of the profession, technology and artificial intelligence, governance, trust, legal considerations, sustainability and emerging business developments.

As Artificial Intelligence reshapes industries, customer expectations and business models worldwide, EMBRAX Multiversity is bringing a globally recognised executive learning experience to Sri Lanka, featuring Harvard Business School Professor Elie Ofek in a three-day programme focused on AI, innovation and marketing leadership.

Hosted by EMBRAX Multiversity, a venture of Academics Group, the Harvard-style Executive Leadership Program will take place from 15 to 17 September 2026 at ITC Ratnadipa, Colombo. The programme is designed to help senior business leaders strengthen their ability to navigate disruption, rethink business models and create sustainable value in an increasingly AI-enabled economy.

Harvard Business School Malcolm P. McNair Professor of Marketing Professor Elie Ofek brings extensive expertise in marketing strategy, innovation, pricing, digital transformation and the strategic implications of emerging technologies. He has taught executives from leading organisations globally through Harvard Business School executive education programmes, helping leaders understand how innovation and technology can be transformed into sustainable business advantage.

The programme will adopt a discussion-driven learning approach inspired by the Harvard Case Method, placing participants in real-world business situations where they are required to analyse challenges, evaluate alternatives and make strategic decisions. Sessions will explore key areas including AI and business strategy, innovation, marketing leadership, customer-centric growth, pricing and value creation, organisational transformation and strategic decision-making.

The program comes at a time when Sri Lankan organisations are increasingly required to compete not only within domestic markets, but also with regional, global and digitally enabled businesses. As technology continues to accelerate the pace of change, organisations need leaders who can combine strategic thinking, innovation capabilities and business agility to create long-term value.

EMBRAX Multiversity believes that strengthening leadership capability will be critical for organisations seeking to respond effectively to technological and market transformation while preparing for future opportunities.

EMBRAX Multiversity and Academics Group President and CEO Kandeban Balendran said, ‘The future belongs to organisations that learn faster than the pace of change. Our vision is to bring globally respected faculty, world-class ideas and transformative executive education closer to Sri Lankan business leaders. By investing in leadership today, organisations are also investing in their long-term competitiveness and Sri Lanka’s future growth.’

The program is intended for CEOs, directors, business owners, general managers, functional heads, senior managers and emerging leaders identified for future leadership roles. With participant numbers limited to support an interactive learning environment, organisations are encouraged to nominate suitable executives early.

Registrations can be made through EMBRAX Multiversity via Mahesha on +94 76 594 9622 or [email protected], and Purnima on +94 74 151 7415 or [email protected].

Inflation is a phenomenon faced by every citizen of a country and, therefore, warrants public attention. It affects the decisions of households, businesses, and the Government. Globally, central banks are generally entrusted with the responsibility of maintaining low and stable inflation, which is referred to as price stability. For this purpose, central banks implement monetary policy. When implementing monetary policy to maintain price stability, central banks generally have a targeted level of inflation.

Depending on the monetary policy framework of a country, this target may either be explicitly communicated to the public or, in some cases, central banks may aim to achieve price stability in general without specifying an explicit target. In particular, central banks that pursue an inflation-targeting policy framework, or its variants, set an inflation target that the central bank strives to achieve. This targeted level of inflation varies across countries and is influenced by the respective economic structures.

The Central Bank of Sri Lanka (CBSL) conducts monetary policy within a flexible inflation-targeting framework, which is a variant of the broader inflation-targeting framework. Flexible inflation targeting provides the overarching framework for the conduct of monetary policy by CBSL and is used to accomplish its core objective of achieving and maintaining domestic price stability.

The Central Bank of Sri Lanka Act, enacted in 2023, provides the legal basis for this framework. Under this, CBSL aims to keep inflation aligned with the target set out in an agreement between the Minister of Finance and the Central Bank. This agreement, known as the Monetary Policy Framework Agreement (MPFA), requires the Central Bank to maintain quarterly headline inflation at 5%. A margin of ±2 percentage points is specified under the MPFA to measure potential deviations from the target, which would trigger the relevant accountability measures.

The Central Bank Act states that the inflation target and related parameters may be reviewed once every three years or at a higher frequency under exceptional circumstances. Accordingly, the current inflation target, agreed upon in October 2023, is due for review in the near future. Against this backdrop, this article aims to shed light on the major factors that determine a country’s inflation target.

Inflation targets across the world

Specifying an inflation target involves selecting a price index to define the target, assigning a numerical value to the target, and deciding whether to define the target as a point or a band. A point target is generally associated with a band around the central target, which is used to measure deviations from the target and may also be linked to an accountability mechanism. A well-defined inflation target may also contain escape clauses or exemptions under specific circumstances.

Table 1 presents inflation targets for selected countries worldwide. The dataset is based on a recent study by Zhang (2025), and the inflation targets are as of the fourth quarter of 2024. For countries with a range set as the inflation target, such as Australia and South Africa, the midpoint of the target range is given. For ease of analysis, the countries are categorised by income level based on the latest World Bank classification, which uses Gross National Income (GNI) per capita to classify economies.

As shown in Table 1, inflation targets for the selected high-income countries range from 2% to 4.5%. Countries such as New Zealand, Canada, the United Kingdom, Finland, Sweden, and Australia were among the early adopters of inflation targeting. These economies have evolved over a long period under inflation-targeting policy frameworks, and most have set relatively low inflation targets, such as 2%. However, not all high-income nations have such low inflation targets, as shown in Table 1.

Among middle-income countries, inflation targets exhibit greater diversity. Targets range from 2% for economies such as Peru and Thailand, to 5% for economies such as Moldova and Turkey, and to relatively high levels such as 8% for Ghana. Moreover, middle-income countries represent a diverse group, particularly in terms of financial market development and the effectiveness of monetary policy transmission mechanisms. Furthermore, in many middle-income countries, administered prices are an important component of aggregate price indices and therefore influence the short-run behaviour of inflation. Such economies also tend to be more susceptible to a range of supply shocks. All these factors are important considerations when determining a suitable inflation target.

Level of economic development

The level of economic development can have implications for both consumer price inflation and inflation volatility. The composition of the consumption basket can vary with the level of economic development. In high-income countries, the share of food in the Consumer Price Index (CPI) basket tends to be lower. The volatility of CPI inflation arising from supply-side shocks, such as adverse weather conditions and energy price shocks, is therefore relatively lower in advanced economies.

In contrast, the consumption baskets of developing countries are generally characterised by relatively large food shares, making their price indices more susceptible to supply-side shocks. Developing countries also tend to have more volatile macroeconomic environments and less-developed financial markets. All these factors need to be taken into account when choosing an inflation target.

Figure 1 depicts the relationship between per capita income and inflation targets for a set of selected inflation-targeting countries. There appears to be an inverse relationship between the two variables. In high-income countries, inflation targets are concentrated around 2%. Among middle-income countries, however, inflation targets are distributed across a wider range of relatively larger values.

Country-specific characteristics of inflation dynamics

Typically, when a country sets an inflation target for the first time, it is natural to place greater weight on past inflation levels. A measure of central tendency of past inflation, such as average inflation over several years, provides a general indication of a country’s long-term equilibrium level of inflation – that is, the level of inflation that would prevail in the economy under normal circumstances.

However, when a country revises its inflation target, the exercise needs to be more forward-looking. Relatively less weight should be placed on past inflation levels, with greater focus instead placed on the level of inflation that the country can sustainably achieve in the future, given the overall macroeconomic outlook and the structure of the economy envisioned for the near future.

In addition to the average level of past inflation, the extent to which inflation has varied over time is also an important consideration. This is commonly referred to as inflation volatility. Inflation volatility generally depends on the composition of the consumption basket used in the CPI, the structure of the economy, income levels, the degree of financial market development, and other factors.

Figure 2 depicts the inflation targets of selected economies against inflation volatility, measured by the standard deviation of annual average inflation over the 20-year period from 2005 to 2024. There appears to be a broadly positive relationship between the two factors. This indicates that countries with lower inflation volatility tend to have lower inflation targets, while countries with higher inflation volatility tend to have higher inflation targets. This could partly be explained by the fact that, when inflation volatility is high, the inflation target may need to be set at a level that provides sufficient room for inflation to fluctuate without persistently breaching the target.

In the case of Sri Lanka, even after excluding 2022 and 2023 due to the exceptional inflationary shock experienced by the country, inflation volatility remains relatively high compared with most other inflation-targeting countries. Therefore, Sri Lanka’s relative position in terms of inflation volatility should be an important consideration when setting a credible inflation target.

Vulnerability to energy shocks

Global energy price shocks can have significant implications for a country’s inflation dynamics. While some economies are better equipped to withstand fluctuations in global energy prices, others face greater challenges and experience a stronger pass-through to domestic prices. Such supply-side inflationary pressures can affect both the level and volatility of inflation.

Therefore, when considering the country-specific characteristics of inflation dynamics discussed above, it is important to assess the extent to which a country is equipped to handle global energy price and other supply-side shocks. Resilience to energy shocks forms part of the broader economic resilience of a nation.

In this analysis, vulnerability to energy shocks is proxied by the Global Energy Vulnerability Index compiled by Euromonitor International. The index assesses a country’s energy security across several pillars, including alternatives to fossil fuels, energy reserves potential, energy accessibility, and energy efficiency. Figure 3 depicts the ranking in the Global Energy Vulnerability Index against the inflation targets of selected economies. Countries with relatively low energy vulnerability are ranked at the top, while countries with relatively high energy vulnerability are ranked towards the bottom.

Financial market development

Financial markets play an important role in the transmission of monetary policy actions to the broader economy. The degree of financial market development determines the time taken for policy actions to pass through to the economy as well as the magnitude of the transmission. Underdeveloped financial markets could distort the pass-through of monetary policy actions, whereby some policy adjustments may be attenuated during transmission. The opposite could also occur. Therefore, the outcome of an inflation-targeting policy framework is largely determined by the underlying institutions and markets in the financial sector.

For this analysis, the level of financial market development is proxied by the Financial Development Index compiled by the International Monetary Fund (IMF). The Financial Development Index provides a relative assessment of countries based on the depth, access, and efficiency of their financial institutions and financial markets. A higher index value reflects a higher level of financial market development.

Figure 4 depicts the inflation targets of selected economies against their Financial Development Index as of 2020, the latest available data. It appears that there is an inverse relationship between the degree of financial development and inflation targets. Therefore, countries with well-developed and efficient financial markets and institutions tend to have lower inflation targets.

Central bank independence

Central bank independence is a necessary condition for effectively pursuing an inflation-targeting monetary policy framework. For this analysis, central bank independence is measured by the Central Bank Independence – Extended (CBIE) Index of Romelli (2025). It encompasses dimensions such as limitations on lending to the Government, financial independence, authority to formulate monetary policy, and the appointment procedures for the Governor and the Board.

Figure 5 depicts the inflation targets of selected economies and the corresponding Central Bank Independence Index as of 2023. A higher Central Bank Independence Index value indicates a higher degree of central bank independence. It appears that there is no strong relationship between the index value and the inflation target. Among countries with a high degree of central bank independence, some have set relatively low inflation targets, while others have set relatively high targets.

This suggests that a high degree of central bank independence does not necessarily imply that a country should target a lower inflation rate. In other words, the inflation target is not primarily determined by the degree of central bank independence, but rather by the structural characteristics of the economy.

Requirement for policy space

Developing economies may require larger changes in policy interest rates to bring about the desired changes in demand conditions and steer inflation towards the target. A narrow gap between the zero lower bound and prevailing policy interest rates could pose a risk of the central bank reaching the zero lower bound when a stronger monetary policy stimulus is required. This could force the central bank to shift towards unconventional monetary policy tools, the effectiveness of which may vary across countries. Having a comfortable margin between the zero lower bound and the normal level of policy interest rates is referred to as policy space in monetary policymaking.

When setting an inflation target, an assessment should therefore be made of the possible normal, or long-run equilibrium, level of nominal policy interest rates. This would be the sum of the natural real policy interest rate of the economy – the real policy interest rate when inflation is at its target and the real output gap is closed – and the inflation target. The lower the inflation target, the lower the long-run equilibrium nominal policy interest rate is likely to be. Therefore, when setting the inflation target, it is important to assess the implications for interest rates in the long run and the resultant implications for monetary policy space.

Conclusion

Price stability – a low and steady inflation rate – is the major contribution that monetary policy can make to economic growth (IMF, 1998). Sri Lanka has chosen to conduct its monetary policy within an inflation-targeting framework, given the success of economies that have used such frameworks to maintain price stability. Setting a credible and achievable inflation target is crucial under such a framework. An inflation target implies a broad consensus among key stakeholders in the economy about the appropriate or optimal rate of inflation.

This article does not aim to advocate a particular inflation target. Instead, it draws on global experience to assess how differences in macroeconomic circumstances can affect the appropriate inflation target. The analysis above shows that the structure of an economy – as reflected in its level of economic development or income; its vulnerability to energy and other supply-side shocks; the volatility of inflation; and the extent of financial market development – plays an important role in determining an appropriate inflation target. Central bank independence, meanwhile, should be preserved to ensure the effective implementation of monetary policy in achieving the chosen target.

Global evidence shows that while high-income countries have generally adopted relatively low inflation targets, middle-income economies have selected targets across a much wider range. In the context of Sri Lanka, any revision to the inflation target should therefore be considered alongside a candid assessment of the current structure of the economy and the direction in which the economy is expected to evolve over the coming years. The inflation targets adopted by other countries also indicate that Sri Lanka does not need to anchor its decision around a few selected values. Instead, the target can be considered from a broader perspective, taking into account the country’s own economic characteristics and its future trajectory.

If an adjustment to the inflation target is considered appropriate, global experience suggests that it may be more prudent to make such an adjustment in smaller, measured steps rather than through a large one-off change. A credible target must ultimately serve as a bridge between structural economic realities and public trust, ensuring price stability protects all income groups while supporting long-term macroeconomic stability.

The Institute of Certified Management Accountants (CMA) of Sri Lanka) has announced the extension of the application deadline for the National Cost and Management Accounting Excellence (NCMA) Awards 2026 until 28 August 2026, providing organisations with additional time to prepare and submit their entries. The decision was made in response to the significant interest shown by organisations and the numerous requests received for an extension.

The National Cost and Management Accounting Excellence Awards is a flagship national recognition program organised by CMA Sri Lanka to honour organisations that have successfully integrated Cost and Management Accounting principles into their strategic and operational decision-making processes. The awards recognise organisations that have demonstrated excellence in optimising resources, enhancing productivity, improving governance, driving innovation, and creating sustainable value for stakeholders.

Held under the theme ‘Optimising Resources, Creating Value and Enriching Lives,’ the awards aim to promote best practices in Cost and Management Accounting while encouraging organisations to adopt innovative management techniques that contribute to improved financial performance, operational excellence, and long-term sustainability.

The NCMA Awards recognise outstanding achievements in several key areas, including cost optimisation, waste elimination and efficiency enhancement, strategic financial leadership, performance improvement initiatives, governance and accountability, innovation and value creation, and contributions to national economic development. Through these awards, CMA Sri Lanka seeks to inspire organisations to embrace world-class management accounting practices that support informed decision-making, effective resource utilisation, and sustainable business growth.

The competition is open to organisations representing 35 industry sectors, reflecting the diversity of Sri Lanka’s economy. These sectors include Plantations, Agriculture, Banking, Financial Services, Construction, Consultancy Services, Education, Export Companies, Healthcare Related Services, Hospitality and Tourism, ICT Services, Insurance, Infrastructure and Utilities, Livestock and Fisheries, Logistics and Transport, Printing and Related Services, Specialised Banking Services, Manufacturing (Engineering, Food and Beverage, Chemical, Tiles and Ceramics, Apparel, Textile, Footwear and Leather Products, Non-Traditional Sector, State Sector and Other Manufacturing), Media Services, Shipping and Shipping Related Services, Power and Energy, State Services Sector, Trading, Gem and Jewellery/Other Services, Diversified Group of Companies, Associations and Societies, and Other sectors.

To facilitate the application process, organisations intending to participate are requested to pre-register by confirming their participation via email to [email protected]. Pre-registration will enable CMA Sri Lanka to provide applicants with the necessary guidance and support throughout the application process.

Interested organisations are required to complete and submit the official NCMA Awards application form together with the relevant supporting documents on or before the extended deadline of 28 August 2026.

CMA Sri Lanka invites eligible organisations from across all sectors to seize this opportunity to participate in the National Cost and Management Accounting Excellence Awards 2026 and gain recognition for their commitment to excellence in Cost and Management Accounting.

For further information, application forms, and registration details, interested organisations may contact Ms Rashmi at the Institute of Certified Management Accountants of Sri Lanka via [email protected] or call 074 321 3860. The extended application period provides organisations with an excellent opportunity to prepare comprehensive submissions and become part of Sri Lanka’s premier awards program dedicated to excellence in Cost and Management Accounting.

Iga Swiatek will meet Elena Rybakina in the Canadian Open final after both players battled through their semi-finals in three sets.

Six-time Grand Slam champion Swiatek withstood an Elina Svitolina comeback attempt to seal a 6-3 1-6 6-3 win in Toronto and reach her first WTA final of the season.

The Pole, 25, has not reached a final since winning Cincinnati 12 months ago and had only reached one semi-final this year.

‘It hasn’t been an easy season, probably the toughest one in my life,’ said seventh seed Swiatek.

‘This week has been really positive and inspirational for me, and it always kind of shows that you need to keep going no matter what.’

Later, Australian Open champion Rybakina sealed her place in the final, despite losing the opening set to Coco Gauff.

After winning four games in a row to clinch the second set, the world number two secured a 5-7 6-2 6-2 victory, having also come from behind to win her quarter-final against Naomi Osaka.

The new multi-cuisine restaurant brings variety, comfort food and contemporary dining to Kinross Avenue

Colombo’s dining scene has welcomed a new addition with the opening of Tamarind Multi Cuisine Restaurant at 09 Kinross Avenue, Colombo 04.

Spread across more than 6,000 square feet, the two-storey restaurant brings Indian, Chinese, Sri Lankan and popular Western favourites together under one roof.

Designed as a versatile dining destination, Tamarind can accommodate approximately 100 diners in one seating. Its extensive menu features a selection of familiar favourites and signature dishes, including Tom Yum soup, sizzling platters, butter chicken, hot butter cuttlefish, Kerala parotta, chop suey rice, nasi goreng and an array of dishes.

The concept is built around variety, allowing diners to enjoy different cuisines in one place. The extensive selection also makes Tamarind particularly suited to families and larger groups looking to share and sample a range of dishes.

Founder Farhan Hameed said the restaurant was created with the modern diner’s desire for variety and convenience in mind. ‘Diners today want to enjoy a little bit of everything in one place, while still having good food and value for money. That was the idea behind Tamarind. I am passionate about serving food that people enjoy, and we have brought together experienced chefs, including four chefs from India specialising in Indian cuisine, along with expertise in Chinese cuisine, to create a memorable dining experience.’

The food is complemented by an interior that combines contemporary design with a warm, inviting atmosphere. Rich forest-green hues, wooden accents and mural artwork create a sophisticated yet relaxed setting, while the subtle fragrance of cinnamon that greets guests adds a distinctly Sri Lankan touch.

Tamarind offers a choice of indoor, outdoor and balcony seating, along with an outdoor Indian pod featuring a live open kitchen. The restaurant also includes a dedicated children’s playroom and two private dining rooms, providing more intimate spaces for celebrations, family gatherings and corporate dinners.

The restaurant’s design is intended to transition naturally from relaxed daytime dining to a livelier evening experience, with different spaces allowing guests to choose an environment suited to the occasion.

At the heart of Tamarind is its multi-cuisine approach, bringing together Indian, Chinese, Sri Lankan and Western dishes while encouraging guests to share and explore. The Indian kitchen is supported by chefs from India, adding specialist expertise to the restaurant’s Indian offering, while its Chinese and international selections further broaden the menu.

With its combination of varied cuisine, spacious interiors and flexible dining options, Tamarind aims to offer something for everyone, from a casual meal with family to a celebration or evening out with friends. Tamarind Multi Cuisine Restaurant is open daily from 11.30 a.m. to 11.00 p.m. at 09 Kinross Avenue, Colombo 04.

The Commercial Bank of Ceylon Group said yesterday it has reiterated leadership in financial intermediation, becoming the first private sector banking group in Sri Lanka to cross the Rs. 3 trillion threshold in deposits, a new performance benchmark established in the second quarter of the 2026 financial year.

The Group’s deposits grew by Rs. 315.13 billion in the six months ending 30th June 2026, at a monthly average of Rs 52.52 billion, to end the first half of the year with deposits of Rs. 3.02 trillion. Over the preceding 12 months, deposits grew by a noteworthy 20.33% at a monthly average of Rs. 42.46 billion.

In the six months reviewed, the Group’s gross loans and advances grew by Rs. 270.43 billion at an average of Rs. 45.07 billion per month, taking the loan book to Rs. 2.36 trillion, underscoring the scale of the Bank’s role in financial intermediation. Lending over the preceding 12 months grew by Rs. 624.48 billion or 36.07% at a monthly average of Rs. 52.04 billion.

Interim financial statements filed with the Colombo Stock Exchange (CSE) report that total assets of the Group grew by 10.68% or Rs. 361 billion since December 2025 to Rs. 3.74 trillion as at 30th June 2026. This reflects an impressive increase of 19.42% or Rs. 608.16 billion over the preceding 12 months.

Chairman Sharhan Muhseen said: ‘As the impacts of global and regional developments continue to take their toll on businesses and economies, our stakeholders can draw confidence from the resilience underscored by the enduring strength of our core banking operations.

‘We continue to refine our projections and strategic responses to the evolving challenges while remaining firmly anchored to our strategic vision and steadfast in our commitment to delivering lasting value to our customers, stakeholders and the wider community we serve.’

Managing Director and CEO Sanath Manatunge said: ‘Our prudential approach of maintaining adequate buffers to cushion the adverse impacts of external factors is evident in our six-month results. This includes an increase in impairment provisioning, noticeably in respect of the second quarter. While our heightened emphasis on risk management is dictated by the volatile global economic landscape, we remain well positioned to support our customers through the turbulence.’

Comprising Sri Lanka’s largest private sector bank and six subsidiaries, the Commercial Bank Group reported gross income of Rs. 209.16 billion for the six months, an increase of 18.28%. Gross income for the second quarter alone grew by 24.04% to Rs. 110.16 billion. Interest income improved by 17.05% to Rs. 171.65 billion for the six months, and by 19.86% to Rs 88.76 billion for the second quarter, primarily due to the growth of the loan book.

Interest expense for the six months under review grew by 18.14% to Rs. 91.96 billion, and by 21.36% to Rs. 47.88 billion in the second quarter primarily due to the growth in the deposit portfolio. As a result, the Group recorded net interest income of Rs. 79.69 billion for the six months and Rs. 40.88 billion for the second quarter, reflecting growth of 15.81% and 18.16% respectively.

Total operating income for the six months grew by 17.85% to Rs. 109.07 billion, and by 26.55% to Rs. 58.23 billion for the second quarter. The Group increased its provisions for impairment charges and other losses by 33.44% to Rs. 14.85 billion for the six months as a prudential measure in the backdrop of uncertainties in the geopolitical environment. Impairment charges and other losses for the second quarter alone, at Rs. 11.67 billion, represented an increase of 193.38%.

Consequently, net operating income for the six months grew by 15.72% to Rs. 94.23 billion, and by 10.77% to Rs. 46.57 billion in the second quarter. Operating expenses meanwhile increased by 18.47%, to Rs. 30.61 billion for the six months, with the Bank’s staff strength crossing 6,000 in June 2026. As a result, the Group posted operating profit before taxes on financial services of Rs. 63.62 billion for the six months, an improvement of 14.44%.

With taxes on financial services for the six months increasing by 20.38% to Rs. 10.56 billion, the Group reported profit before income tax of Rs. 53.05 billion, reflecting a growth of 13.33%. Income tax for the period under review increased by 12.67% to Rs. 17.63 billion, generating a six-month net profit after tax of Rs. 35.42 billion for the Group, reflecting a bottom-line growth of 13.66%.

In respect of the second quarter, the Group posted profit before tax of Rs. 25.42 billion and net profit after tax of Rs. 17.49 billion, recording growths of 4.80% and 7.98%, respectively. Taken separately, Commercial Bank of Ceylon PLC reported a profit before tax of Rs. 50.85 billion and profit after tax of Rs. 33.79 billion for the six months, posting growths of 12.39% and 12.45%, respectively.

In key performance ratios, the Bank’s net impaired loans (Stage 3) to total loans ratio stood at 1.38% as at 30th June 2026 compared to 1.54% at end 2025, while its gross impairment (Stage 3) to total loans ratio stood at 5.32% as against 5.81% at the end of 2025 and 6.98% at the end of the second quarter of 2025. The Impairment (Stage 3) to Stage 3 loans ratio improved to 74.14% at end June 2026, from 73.50% at the end of 2025 and 67.49% a year ago.

The Bank’s Tier 1 Capital Ratio as of 30th June 2026 was 13.23%, while its Total Capital Ratio stood at 16.58% as against the regulatory minimum ratios of 10% and 14% respectively.

The Bank’s liquidity coverage ratio as at 30th June 2026 stood at 444.92% for Rupees and 253.94% for all currencies, both well above the statutory minimum ratios of 100%. The Bank’s net stable funding ratio stood at 162.98% as of 30th June 2026, also significantly higher than the minimum statutory requirement of 100%.

In terms of profitability, the Bank’s net interest margin stood at 4.51% (annualised) for the period, unchanged from the end of 2025. The Bank’s return on assets (before tax) was 2.99% compared to 2.96% at end 2025, while the return on equity improved to 20.28% from 19.51% at the end of 2025.

The Bank’s cost to income ratio excluding taxes on financial services stood at 27.82%, as against 29.66% for 2025, while the figure inclusive of taxes on financial services was 37.77% for the six months, in comparison with 39.20% for the preceding year.

The CASA ratio of the Bank declined marginally to 39.17% as at 30th June 2026, from 39.65% at end 2025, but continues to be one of the best in the industry.

DFCC Bank said yesterday it entered the second half of 2026 with a larger and increasingly diversified franchise, following sustained growth across lending, deposits, fee income, and total assets during the first six months of the year.

Loan and deposit portfolios grew by 9% and 12%, respectively, compared to 31 December 2025, while total assets increased by 7% to Rs. 919 billion and total liabilities grew by 8% to Rs. 811 billion.

Net fee and commission income rose by 29%, while Net Interest Income increased by 6% to Rs. 16 billion, demonstrating continued momentum across the Bank’s core income streams.

The first half unfolded against a more demanding external environment. Heightened geopolitical tensions in the Middle East kept commodity prices, particularly energy prices, elevated and increased uncertainty across global markets. In response to inflationary risks, the Central Bank of Sri Lanka increased the Overnight Policy Rate (OPR) by 100 basis points to 8.75% in May 2026. Together with other policy measures, the tightening and its gradual transmission to the real economy are expected to moderate credit growth and demand pressures in the period ahead.

Against this backdrop, the Bank continued to manage its funding profile and margins with discipline. Deposit and lending rates were revised in line with prevailing market conditions, while prudent liquidity management, funding optimisation initiatives, and effective control of funding costs supported a 6% increase in Net Interest Income to Rs. 16 billion. These measures helped preserve balance sheet resilience while supporting sustainable value creation for customers and shareholders.

The Bank recorded a Profit After Tax of Rs. 3.9 billion from core operations. While profitability was lower than in the corresponding period, underlying business momentum remained resilient as management deliberately strengthened prudential buffers in response to evolving geopolitical and macroeconomic risks. Impairment provisioning was reinforced through refinements to credit risk models and specific management overlays, resulting in an Rs. 1.1 billion increase in impairment charges compared to the same period last year. At the same time, the Bank maintained a selective lending approach and strict cost discipline. Notably, the net stage 3 impaired loan ratio improved to 3.61% from 4.55% as at 31 December 2025, reinforcing the Bank’s focus on asset quality and sustainable growth.

A defining strategic development following the reporting period was the completion of DFCC Bank’s acquisition of Standard Chartered Bank PLC’s Wealth and Retail Banking Business in Sri Lanka. First announced to the Colombo Stock Exchange in November 2025, the transaction was completed with the acquired portfolio integrated into DFCC Bank effective 1 August 2026.

The acquisition encompasses approximately 50,000 customer accounts and around 260 employees, while expanding DFCC Bank’s network to 139 locations across the country. Together, these additions materially strengthen the Bank’s retail and wealth management capabilities, reach, and accessibility.

The transaction represents a significant step in DFCC Bank’s growth journey, providing a broader platform for sustainable expansion, deeper customer relationships, and enhanced service delivery while creating long-term value for customers, employees, and shareholders.

Beyond financial performance, 1H 2026 also brought further validation of DFCC Bank’s customer, sustainability, and community agenda. The Bank’s pioneering Blue Bond secured supplementary listings on the Luxembourg Stock Exchange’s Luxembourg Green Exchange and India INX at GIFT City, and was recognised at the Environmental Finance Sustainable Debt Awards 2026.

Profitability

DFCC Bank PLC, the largest entity within the Group, reported a Profit Before Tax (PBT) of Rs. 5,480 million and a Profit After Tax (PAT) of Rs. 3,904 million from core operations for the period ended 30 June 2026, compared to a PBT of Rs. 7,910 million and a PAT of Rs. 5,555 million in the corresponding period.

At Group level, for the period ended 30 June 2026, PBT was Rs. 5,801 million and PAT was Rs. 4,139 million, compared to Rs. 8,172 million and Rs. 5,747 million, respectively, in 2025. The Bank’s Earnings Per Share (EPS) from core banking operations was LKR 8.76 for the period ended 30 June 2026.

The Bank’s Return on Assets (ROA) before tax was 0.99%, while Return on Equity (ROE) after tax stood at 6.19% for the period ended 30 June 2026.

The Bank’s total tax expense, including Value Added Tax (VAT) on financial services, Social Security Contribution Levy (SSCL) on financial services, and Income Tax, amounted to Rs. 3,696million for the period ended 30 June 2026. Consequently, the Bank’s tax expense as a percentage of operating profit stood at 49% for the period.

Net Interest Income

With monetary policy tightening and its gradual transmission to the real economy expected to moderate credit growth and demand pressures, the Bank revised both deposit and lending rates upward during the period in line with prevailing market conditions. Consequently, net interest income increased by 6% to Rs. 16,132 million, supported by disciplined margin management, effective balance sheet optimisation, and continued growth in earning assets. The Bank’s asset base expanded by 17% over the past 12 months, while the loan portfolio recorded a strong 20% growth, reflecting a strategic focus on quality asset expansion and sustainable business growth.

The Bank also strengthened its funding profile, with the CASA portfolio increasing by 14% from 31 December 2025 and the CASA ratio improving to 24.99% as at 30 June 2026. Despite a competitive interest rate environment and prevailing market dynamics, the Bank maintained a healthy Net Interest Margin of 3.66%, underscoring its prudent funding and pricing strategies.

Fee and commission income

Strategic focus on trade-related commissions and card-based services supported strong growth in fee-based income, with the credit card portfolio expansion contributing significantly to overall performance.

While related fee expenses increased in line with customer acquisition and portfolio growth, the net impact remained positive. Net fee and commission income increased by 29% to Rs. 4,187 million, compared to Rs. 3,249 million in the corresponding period of 2025.

Impairment charge on loans and other losses

The net stage 3 impaired loan ratio improved to 3.61% as at 30 June 2026, from 4.55% as at 31 December 2025, supported by recoveries and portfolio expansion.

In response to current and potential future impacts of global and domestic economic conditions on the Bank’s lending portfolio, management strengthened impairment provisioning during the period. This was achieved through enhancements to internal expected credit loss models to capture risk factors not fully observable in the current volatile geopolitical and economic environment, including the recognition of additional provisions as management overlays for exposures to higher-risk sectors and specific customer segments, making additional provision for specific large group exposures.

The Bank also maintained adequate provisioning in line with the accelerated growth in its lending portfolio. As a result, impairment charges increased to Rs. 4,630 million for the period ended 30 June 2026, compared to Rs. 3,482 million recorded in the corresponding period of 2025. These provisions have been established to safeguard the Bank’s financial strength and reflect a more conservative assessment of potential credit risks, considering prevailing macroeconomic conditions and the potential impact of the geopolitical environment.

Operating expenses

Technology and digital transformation continued to be key strategic priorities for the Bank during the period, supported by ongoing investments in IT infrastructure aimed at enhancing digital capabilities, strengthening information security, improving operational efficiency, and delivering a seamless multi-channel customer experience. The Bank also increased its investment in marketing and business development initiatives to strengthen brand visibility, deepen customer engagement, and support growth across key product segments. These investments are expected to create long-term value by reinforcing the Bank’s market position, expanding its customer franchise, and enhancing its competitive advantage in an evolving financial services landscape.

In addition, operating expenses were impacted by annual salary revisions and performance-based incentive payments, reflecting the Bank’s continued focus on attracting, retaining, and rewarding talent while supporting its long-term growth objectives.

As a result of these strategic investments and personnel-related costs, total operating expenses for the six-month period ended 30 June 2026 increased to Rs. 10,969 million from Rs. 8,325 million recorded in the corresponding period of 2025. Nevertheless, the Bank remains committed to maintaining prudent cost discipline and pursuing ongoing efficiency improvements to support sustainable growth and operational resilience.

Other Comprehensive Income

Changes in the fair value of investments in equity and fixed-income securities (treasury bills and bonds), along with movements in hedging reserves, are recorded through other comprehensive income. The application of hedge accounting minimised the impact of exchange rate fluctuations on the Bank’s profitability.

A fair value gain of Rs. 1,144 million was recorded on equity investments outstanding as at 30 June 2026, primarily driven by the increase in the share price of Commercial Bank of Ceylon PLC.

Financial position analysis – Assets

Total assets increased by Rs. 62 billion, representing a 7% growth since December 2025, mainly attributable to the expansion of the loan portfolio, which rose by Rs. 48 billion to Rs. 564 billion, a 9% increase from Rs. 516 billion as at 31 December 2025. This performance demonstrates the successful delivery of DFCC Bank’s strategic growth initiatives, driven by a selective and disciplined lending approach that balances sustainable expansion with asset quality. The renewed confidence amid improving economic conditions reinforces the Bank’s role in driving prudent credit expansion and supporting national economic initiatives.

Liabilities

The Bank’s total liabilities increased by Rs. 61 billion, reflecting an 8% growth from December 2025. The deposit base expanded by 12%, rising by Rs. 67 billion to Rs. 632 billion, up from Rs. 565 billion as at 31 December 2025, resulting in a loan-to-deposit ratio of 97.44%. Additionally, the CASA ratio stood at 24.99% as at 30 June 2026.

The Bank effectively contained funding costs by utilising medium- to long-term concessionary credit lines, which supported the expansion of the lending portfolio and provided concessionary funding to customers. Factoring in these term borrowings, the CASA ratio further improved to 29.42%, while the loan-to-deposit ratio improved to 91.68% as at 30 June 2026.

Equity and compliance with capital requirements

As at 30 June 2026, total equity was maintained at Rs. 109 billion, contributed by a profit after tax of Rs. 3.9 billion and movements across the Bank’s securities portfolios.

In alignment with the Bank’s growth strategy and the improving economic environment, the net loan portfolio grew by 9%. Leveraging the strengthened equity base, the Bank effectively absorbed the additional capital requirements associated with portfolio growth. The Tier 1 Capital Ratio was maintained at 11.947%, while the Total Capital Ratio stood at 15.707%, compared to 13.550% and 15.933%, respectively, as at 31 December 2025.

Following shareholder approval, the Bank is currently in the process of completing the remaining regulatory and administrative formalities relating to the issuance of Basel III-compliant, Tier II, listed, rated, subordinated, unsecured, redeemable debentures, with the objective of raising up to LKR 15 Bn.

The Bank’s Net Stable Funding Ratio (NSFR) stood at 124.43%, and the Liquidity Coverage Ratio (LCR) – all currency – stood at 162.26%, both comfortably exceeding regulatory minimums.

Director/CEO Thimal Perera said: DFCC Bank entered the second half of 2026 from a position of greater scale and a stronger core franchise.

Reported profitability was lower than in the corresponding period, but the half-year should be viewed in the context of the deliberate decisions we have taken to protect the quality and resilience of the franchise. We strengthened impairment provisioning through model refinements and management overlays, maintained a selective approach to lending, and continued to exercise cost and liquidity discipline. Importantly, the net stage 3 impaired loan ratio improved to 3.61%, even as we strengthened our prudential buffers. As we continue to pursue sustainable growth, we will capitalise on opportunities with confidence and purpose, underpinned by sound risk judgement and disciplined execution.

Strategically, we have also entered a new phase. Following the reporting period, we completed the acquisition of Standard Chartered Bank PLC’s Wealth and Retail Banking business in Sri Lanka, effective 1 August 2026. The transaction brings approximately 50,000 customer accounts and around 260 colleagues into DFCC Bank and expands our network to 139 locations. This is more than an acquisition. It is an opportunity to welcome new customers and colleagues, deepen our retail and wealth proposition, and bring the DFCC Bank experience to a broader community with care, consistency, and trust.

Our capital and sustainability agenda also continued to advance. The successful Rs. 10 billion Basel III-compliant GSS+ Bond issuance earlier in the year strengthened our capital position and reinforced investor confidence. Building on this, our pioneering Blue Bond secured supplementary listings on the Luxembourg Stock Exchange’s Luxembourg Green Exchange and India INX at GIFT City, and was recognised at the Environmental Finance Sustainable Debt Awards 2026. These milestones demonstrate the role DFCC Bank can play in connecting Sri Lanka with credible, responsible sources of capital.

Flagship two-day event returns to Waters Edge on 8-9 September with four sessions spanning entrepreneurship, governance, AI in finance and leadership.

The Association of Accounting Technicians of Sri Lanka (AAT Sri Lanka) will hold its flagship AAT Conference 2026 on 8 and 9 September at the Grand Ballroom of the Waters Edge Hotel, Battaramulla, under the theme ‘Precision to Power.’

The conference will convene finance/accounting professionals, business leaders, academics and students to examine how technical precision can be translated into strategic influence in a fast-changing economy.

A fixture on the professional calendar, the conference provides accounting professionals and the wider business community with a platform to engage with the trends reshaping the future of finance.

The conference will be inaugurated by Capital Maharaja Group Chief Executive Officer Suresh Srinivasan, who will attend as the Chief Guest. Renowned for his leadership in driving business transformation and innovation, he is expected to share valuable insights on navigating change and creating sustainable growth in today’s dynamic business landscape. The keynote address will be delivered by CA Sri Lanka President Moore Aiyar Joint Managing Partner and Moore Consulting Ltd., Managing Director Tishan Subasinghe, who will offer his perspectives on the evolving role of the accounting profession and its growing strategic influence in business.

This year’s program is organised around four themed sessions, each led by distinguished presenters and panellists, bringing together strategy, governance, technology and leadership.

The opening session, Strategic Entrepreneurship: Create to Dominate, will be presented by Delhi Metropolitan Education Dean – Strategic Initiatives Prof. Poorva Ranjan, who will explore how bold entrepreneurial thinking creates and sustains market leadership.

The second session, Future of Accounting, Tax and Governance: Govern to Grow, will feature David Pieris Group Finance Director and CA Sri Lanka Past President Heshana Kuruppu, who will discuss the evolving regulatory, tax and governance landscape and its implications for organisations.

The third session, Innovation, AI and Data in Finance: Data to Decisions, will be led by SLASSCOM Chairperson and hSenid Business Solutions PLC CEO/Director Sampath Jayasundara, focusing on how artificial intelligence, digital transformation and analytics are revolutionising financial management and decision-making.

The conference will conclude with Transformative Leadership: Lead to Inspire, featuring Araliya Group of Companies Chairman Dudley Sirisena as Lead Panellist, sharing insights on resilient and purpose-driven leadership in today’s dynamic business environment.

AAT Sri Lanka President Dr. Chamara Bandara, said: ‘The accounting profession is undergoing a profound transformation. While technical competence and precision remain essential, today’s professionals are increasingly expected to contribute to business strategy, governance, innovation and sustainable value creation. The AAT Sri Lanka Conference 2026 has been designed to help participants understand and embrace this evolving role. Through the theme ‘Precision to Power,’ we seek to inspire professionals to move beyond traditional boundaries and become influential decision-makers who can navigate complexity and drive positive change in their organisations and communities.’

Conference Committee Chairman Isuru Kalhara, said: ‘This year’s conference program has been carefully curated to address some of the most significant issues shaping the future of business and finance. The four thematic sessions covering entrepreneurship, governance, artificial intelligence, data-driven decision-making and transformative leadership will provide delegates with practical insights from distinguished experts and thought leaders. We are confident that participants will gain valuable knowledge, meaningful professional connections and fresh perspectives that will empower them to thrive in an increasingly dynamic environment.’

Beyond the technical sessions, the conference is designed to serve as a valuable networking platform, connecting delegates with industry leaders, regulators, academics and peers from across the finance and business community. The program reflects AAT Sri Lanka’s ongoing commitment to ensuring that its members and students remain at the forefront of a profession increasingly shaped by technological advancement, stronger governance expectations and the growing strategic role of finance professionals.

The conference inauguration ceremony will be held on 8 September at 6.00 p.m., while the technical sessions will commence on 9 September from 8.30 a.m. Active members of AAT Sri Lanka will be eligible to earn 15 CPD credits for attending.

An early-bird discount of 10% will apply to registrations made on or before 14 August 2026. For further information, contact AAT Sri Lanka on 074 196 6967 or 011 255 9669, email [email protected], or visit www.aatsl.lk.

St. Peter’s College, Bambalapitiya, stamped their class by defeating Kingswood College 17/12 in the final of the Under-18 All-Island School Elite Rugby Sevens, worked off at the Royal Sports Complex recently.

The Peterites produced an outstanding campaign with attacking flair throughout the tournament. They remained unbeaten on their way to the title, underlining the strength of their junior rugby programme and the depth of talent emerging from the school. In the final, it was the Randles Hills school who led for most of the match, but the lads from Bambalapitiya staged a timely comeback to seal the game in their favour.

In the group stages, St. Peter’s recorded impressive victories over Lumbini College (24-5), Dharmaraja College (24-17), Maliyadeva College (33-7) and Ananda College (15-10), before completing their successful campaign with a 17-12 victory over Kingswood in the final. The side was led by skipper Hashara Madugasge, with Shirash Perera serving as vice-captain. The squad also included Adeesha Nadunajith, Janik Abeygoonawardana, Tharul Hansana, Sandika Niuwanhella, Thenuka Samarakoon, Geon Rajith, Rashwin Sabar, Kaweesha Kawushalya, Sajjad Shabeen, Fouzan Ali, Linuka Liyanage, Nethinu Anthony and Thoshitha De Costa.

The success further highlights St. Peter’s long-standing contribution to rugby in Sri Lanka. The Bambalapitiya school has consistently produced talented players who have gone on to represent club, national and age-group teams, while playing an important role in developing the sport at school level.

Their commitment to producing skilful and disciplined rugby players has made St. Peter’s one of the recognised rugby nurseries in the country. This latest Under-18 Sevens triumph is another indication that the school continues to invest in and nurture the next generation of Sri Lankan rugby talent.

The team was coached by head coach Rajeew Perera, assisted by forwards coach Amila Chathuranga and backs coach Randi Fernando.