Sri Lanka, July 19 -- The Central Bank has issued a direction to licensed financial institutions (LFIs), imposing maximum caps on loan-to-value (LTV) ratios for vehicle-related credit facilities.

The directive, which is effective from yesterday (18), applies to all Licensed Commercial Banks, Licensed Specialised Banks, Licensed Finance Companies (LFCs) and Registered Finance Leasing Establishments (RFLEs).

Accordingly, the opportunity provided based on the 2018 guidelines to obtain financing facilities of up to 90% of the value of the vehicle under the electric category has been reduced to 80% for commercial vehicles, 60% for motor cars, SUVs and vans, 50% for three-wheelers and 70% for other vehicles.

The measure is designed to harmon...