Srilanka, Feb. 20 -- Sri Lanka's banking sector faces a paradox: despite ample liquidity, with banks' liquid assets nearly doubling to 35.25% of total assets, credit growth remains stagnant due to high levels of non-performing loans (NPLs). The Central Bank's recent proposal to restructure SME loans, while welcome, addresses only a fragment of the problem. What Sri Lanka needs is a comprehensive solution: a public-private Asset Management Company (AMC) to resolve crisis-era NPLs. This approach has proven successful across Europe and Asia. Rather than being taxpayer support for banks, or a "bailout", an AMC can serve to create hitherto non-existent markets in the trade of NPLs. In doing so, the taxpayer and the economy at large can reap t...