Sri Lanka’s credit to the private sector credit has expanded by Rs. 146 billion in the first half of 2024 after private credit expanded by Rs 74 billion in June, Central Bank data showed.

Accordingly, Private credit has expanded in the first half of the year by 2%, less than the expansion in the latter half of 2023, which was recorded at a Colvin kidzz 3.7%.

The International Monetary Fund(IMF) in their forecast for the year following the second review expects private credit to expand by 7.2% in 2024.

The expansion in the first half of the year comes after a contraction of 4.2% in the same period last year.

Moreover, speaking at the Monetary Policy briefing held yesterday(24), Central Bank Governor Dr. Nandalal Weerasinghe said that the existing lending portfolio has been repriced with the lending rates coming down.

He said that the share of loans with less than 12.5% interest rates which stood at 37% of the total outstanding lending portfolio by end of 2022 has increased to 60.6% by end of June 2024.

While the loan with higher than 12.5% interest rates has decreased from 63.1% of the total portfolio to 39.4% by end of June 2024. 

However, data showed that about 20.8% of the loans are still 20.5%, while 14.1% is between 15.5-20.49%. 

He said the repricing of the existing loans is taking time mainly due to lending rates of long-term loans such as housing loans.

The Average Weighted Prime Lending Rate(AWPLR) had come down by about 3% in the first half of the year.