Banking Assets Rise 16% to Rs. 24.5T in 9 Months

Sri Lanka’s banking sector recorded strong growth in the nine months ending September 2025, with total assets rising 16% year-on-year to Rs. 24.5 trillion, according to newly released Central Bank data. Profit After Tax (PAT) also posted a significant increase, climbing 55% to Rs. 279 billion.

The industry added Rs. 3.3 trillion in assets over the year, supported by expanding loan portfolios and increased investment activity. Net loans and receivables grew to Rs. 12.1 trillion from Rs. 10.2 trillion, while investment holdings rose to Rs. 9.7 trillion from Rs. 8.1 trillion. Cash balances saw a marginal uptick to Rs. 1.87 trillion, and other assets declined to Rs. 587 billion.

Deposits strengthened to Rs. 19.7 trillion, compared to Rs. 17.4 trillion in the previous year. Borrowings increased to Rs. 1.6 trillion from Rs. 1.3 trillion, and other liabilities climbed to Rs. 916 billion. Equity and reserves improved to Rs. 2.3 trillion from Rs. 1.9 trillion.

Net interest income rose to Rs. 754.2 billion from Rs. 616.4 billion, while non-interest income increased to Rs. 203.1 billion from Rs. 141.1 billion. Operating expenses reached Rs. 356 billion, up from Rs. 320 billion. Notably, impairment charges fell to Rs. 45 billion from Rs. 65 billion.

The sector’s profitability indicators also showed improvement. Return on equity increased to 17.5% from 13.3%, and return on assets improved to 2.5% from 1.9%. The non-performing loans (NPL) ratio declined to 11.2% from 12.4%.

Liquidity levels remained robust, with liquid assets accounting for 36% of total assets. The rupee liquidity coverage ratio stood at 298.8%, compared with 345% a year earlier, while the all-currency LCR registered 260%, down from 284%. The credit-to-deposit ratio edged up to 66.9% from 64.9%.

Regulatory capital remained broadly stable, with the overall capital ratio at 18.4%, marginally below 18.5% a year earlier. Tier 1 capital improved to 15.1%, up from 14.8%.