Central Bank Governor Ajith Nivard Cabraal has the privilege of being recognized as the head of the Central Bank who has managed to convert the institution that formulates financial policies in the country and monitors banks and financial institutions in the country into a commercial bank.
It has become evident with the Central Bank Governor’s decision to release millions of dollars received by the Norwegian Central Bank (Norway, Sweden and Finland) for poverty alleviation programmes at 0.05% to the financial market at 8-9% interest rates.
The Central Bank Governor has released the monies through Taprobane Investments owned by one of his friends Ajith Devasurendra. The other partner of Taprobane Investments is the Managing Director of LOLC, Ishara Nanayakkara and the former owner of Lanka Bell, Shankar.
Taprobane Investments has lent the monies to LOLC keeping a 2% profit margin and the company has in turn lent the monies at interest rates ranging between 16-36%.
The Norwegian Central Bank has called for a report from the Central Bank of Sri Lanka on how the monies lent by the Bank had been utilized in the poverty alleviation programme.
It is learnt that the Governor of the Central Bank of Sri Lanka is now engaged in various delaying tactics to avoid giving a report.
Governor Ajith Nivard Cabraal is now known as the most short sighted head in the Central Bank’s history. The country’s economy has incurred a loss of over Rs. 282 billion due to the Governor’s decision to intervene in maintaining the exchange rate until last month.
The rupee has now fallen to Rs. 124.60 against the dollar and economists warn that it would fall further to around Rs. 130 by the April New Year. They say that it would be difficult to prevent the rupee from falling to a level between Rs. 140 and Rs. 150 by the end of the year.