COLOMBO, April 3 (Xinhua) -- Central Bank of Sri Lanka (CBSL) has issued guidelines for the establishment of Business Revival Units (BRU) in licensed banks to support the revival of viable businesses, the CBSL said in a statement on Wednesday.
The aim of setting up the BRUs is to assist both performing and non-performing borrowers of licensed banks whose businesses are fundamentally viable to revive, the statement said.
The statement said that the licensed banks have already established Post COVID-19 Revival Units and the CBSL has issued guidelines to strengthen the functions of the above units and reformulate such units as BRUs.
The challenging macroeconomic conditions that prevailed during the recent years have disrupted businesses, adversely impacting the ability of borrowers to duly repay their loans, and thereby impairing the recovery process of licensed banks, the statement said, adding that the enhanced scope of proposed BRUs will facilitate a sustainable revival of viable businesses affected by the extraordinary macroeconomic conditions.
The business can be revived through both financial and operational restructuring tools and processes, and the selection of an appropriate set of revival tools is subject to the mutual agreement of parties involved in the revival process, CBSL said.
According to the Department of Census and Statistics, about 20 percent of small and medium scale businesses had been closed down during COVID-19 pandemic and the subsequent economic crisis. ■
