Govt. shouldn't steer commercial banks to bankruptcy: Gammanpila

The government should not influence commercial banks for political projects leading them to bankruptcy, Pivithuru Hela Urumaya (PHU) leader and MP Udaya Gammanpila said yesterday.

Addressing a news briefing, he said the Central Bank (CB) had requested the heads of commercial banks to join the national
‘Gamperaliya’ programme by granting loans up to Rs.100,000 without any collateral.

“CB officials including its governor have made this proposal to several commercial banks on July 26. However, bank high-ups have refused the request saying bad debt accumulated from such loans will burden them, thereby passing it on to State banks,” he said.

Moreover, MP Gammanpila said commercial banks were negative in increasing the loan limit for pawning jewellery in a bid to improve the currency in circulation.

“Commercial banks don’t want to increase the loan limit for pawning jewellery because they have concerns over how helpless depositors will become when gold prices reduce,” he said.

On a different note, he said the 15% interest granted to deposits made by senior citizens may be terminated in the future.

“The Central Bank bears the difference between the current interest rate and the 15% granted to senior citizens. However, it has not been practised for six quarters,” he said. (Lahiru Pothmulla)