Fitch releases 2012 outlook for Sri Lankan banks

Key Issues

Strong loan expansion to continue

The Sri Lankan banking sector experienced strong loan growth of about 24% (annualised) in 6M11 and Fitch forecasts loan growth to remain above 25% in 2012 supported by strong economic growth. The loans to GDP ratio increased marginally in H111 to 36% from 35% at end-2010, which is still below the 41% average from 2006-2008.