ComBank becomes biggest lender to SME sector in 2020

• Finance Ministry annual report discloses that ComBank accounted for more than a fifth of loans 

The Ministry of Finance has confirmed that Commercial Bank of Ceylon was the biggest lender to Sri Lanka’s SME sector in 2020 among all State-owned, private and specialised banks in the country, accounting for more than a fifth of all loans in terms of value and number.

According to the Ministry’s Annual Report for 2020, Commercial Bank lent Rs. 163.98 billion or 21.57 percent of the Rs. 759.7 billion in loans provided to SMEs by 19 institutions, while the 58,584 loans provided by the bank represented 23.82 percent of the total of 245,883 loans granted in the pandemic-impacted year.

The value of Commercial Bank’s lending to SMEs was Rs 21.6 billion or 15 percent more than the next lender, Ministry’s published data revealed.

Commercial Bank was also the highest lender to the ‘Industry’ sector dispensing Rs. 45.9 billion or 21.3 percent of the total via 9,654 loans.

Of the total of Rs. 163.9 billion granted to the SME sector by Commercial Bank, 4.47 percent was to the agriculture sector, 14.58 percent to the services sector, 28 percent to the industry sector and 52.9 percent to ‘Other’ sector.
“There can be no better illustration of our commitment to our mission and to the national economy than this,” Commercial Bank Managing Director S. Renganathan observed. “The data also reaffirms our status as a systemically important bank in Sri Lanka. Our role in supporting the SME will be further strengthened in the years ahead with the US$ 50 million loan the bank recently secured from the UK’s CDC Group.”

He pointed out that Commercial Bank was the leader in providing financial relief, especially to SMEs, under the Government stimulus package during the first wave of the pandemic in 2020. “This was a noteworthy contribution in setting the trend in providing financial support to the sector, given that the country was at a total lockdown at that time and there was no assurance when the country situation would return to normality,” 
Renganathan said.

The bank completed its SME Banking Transformation operation in 2020 which introduced a new SME architecture that included the launch of a Centralised Credit Processing Unit that paved the way for Commercial Bank to become the largest lender to the SME sector among private sector banks in 2020 via the ‘Saubhagya’ scheme. 

The bank also launched ‘Arunella’ – a Financial Support Scheme that included 12 initiatives designed to assist and provide concessions to SMEs. This included a moratorium scheme, relief to non-performing borrowers, reduction of lending rates, concessions for Credit Card holders, concessions and fee waivers, and free digital services, to name a few. It also included two special loan schemes, one for SMEs affected by COVID-19 and the other the ‘Dirishakthi COVID-19 Support Loan’ scheme to assist micro enterprises disrupted by the pandemic.