The new bank will be the second fully government owned savings bank after National Savings Bank, which was established in 1972.
At the initial stage, the Central Bank has only given approval for accepting deposits as the sole banking activity, with the bank also devising a plan to repay old Pramuka depositors within two years.
Officials running the bank are facing the challenging task of re-building the image of the bank with the help of a government guarantee and the promise of expanding activities within two years.
"We have to rebuild confidence now. The problem is confidence is negative and people know that although we come under a new name, this is Pramuka bank, which has liabilities," J W Wickramasinghe, Chairman of Sri Lanka Savings Bank said.
"We have to engage in a rebuilding sort of attempt and I think this government guarantee will go a long way in helping us."
National Insurance Trust Fund may become the major depositor of the bank, Wickremasinghe says, with the