Sri Lanka, May 29 -- Sri Lanka's tighter macro prudential restrictions on vehicle and gold-backed lending will benefit lenders' risk profiles, particularly those of finance companies, Fitch Ratings says.

The Central Bank of Sri Lanka's lower loan-to-value (LTV) caps target two products that have expanded rapidly in recent years and represent a substantial share of mainly finance companies' balance sheets, Fitch Ratings in a statement said yesterday. "The tighter caps may also weigh on volumes and earnings growth, particularly for lenders with high exposure to these products", the stateement added.

The LTV cap on motor car financing was lowered on May 25, 2026 to 60% from 70% for vehicles registered for over one year, and to 40% from 60%...