Sri Lanka, July 18 -- The Central Bank of Sri Lanka (CBSL) yesterday announced new Directions, effective July 18, 2025, imposing maximum loan-to-value (LTV) ratios on credit facilities granted for the purchase or utilization of motor vehicles.

These measures, outlined in "Central Bank of Sri Lanka Act Directions No. 02 of 2025," aim to enhance macroprudential policymaking, mitigate systemic risks, and reinforce prudential credit standards across financial institutions.

The new regulations apply to Licensed Commercial Banks, Licensed Specialised Banks, Licensed Finance Companies (LFCs), and Registered Finance Leasing Establishments (RFLEs).

The CBSL is empowered to implement these macroprudential instruments under Section 105(1) read with...