Sri Lanka central bank to clean up data act under IMF program

July 26, 2009 (LBO) – Sri Lanka’s central bank will improve data reporting following the approval of a 2.6 billion US dollar facility by the International Monetary Fund, a loan document released by the monetary authority said. IMF sent a ‘safeguards assessment’ mission to the central bank in May to ensure that its funds could not be mis-used and reliable data to monitor the program was in place.

The Central Bank said it will work with IMF staff to carry out recommendations in the report “with a focus on the priority recommendations in the areas of external audit and data reporting.”

The IMF probe had found that in “many respects” the central bank had “a relatively strong safeguards framework,” the document said.

The Central Bank has already cleaned up its foreign reserve reporting. In May it revealed that 200 million US dollar lent to domestic banks, and is therefore a domestic asset.

Though gross foreign reserves for March 2009, were reported as 1272 million, about 200 million was loaned to domestic banks, the monetary authority said. In subsequent months the loan has been steadily brought down.

The net foreign assets of the central bank – which backs the domestic money supply – were also revised dow