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Sri Lanka’s domestic banks are still far from coming to grips with modern risk management techniques, though branches of foreign banks were coping better, a survey that was out in November, has revealed. Sri Lanka’s domestic banks are still far from coming to grips with modern risk management techniques, though branches of foreign banks were coping better, a survey that was out in November, has revealed. Out of nine domestic banks that took part in the survey, by Indian rating agency CRISIL and the Sri Lanka Bank’s Association, only one felt it would be compliant in 2006, with Basle II.

Basle II is the international banking standard that is due to replace the current Basle standards governing bank regulations.

Four local banks felt it was possible, others felt they would be unable to comply with Basle II.

“Foreign banks are better placed to mange risks,” says Executive Director, CRISIL, D Ravishankar addressing a seminar on risk management in Sri Lankan banks on Monday.

All of the six foreign banks in the survey felt the would be able to comply with Basle II to varying degrees.

Also very few local banks have actually got round to developing tailor made rating models targeting dif