Consolidation in both the banking and non-bank finance company sector has been a recurring theme during most of the recent communications by the Central Bank, as it aims at further strength and stability in the two sectors, particularly at the latter, considering some pockets of weakness there.

Announcing the medium-term monetary and financial sector policies for 2024 and beyond, the Central Bank last week said it expects to facilitate market-based consolidation among small and mid-sized banks or between them and other suitable financial institutions via mergers and acquisitions.

Prior to 2015, the banking and non-banking sector embarked on what some referred to as forced consolidation to build five larger banks and 20 large finance companies in the country, to make them ready to fund the mega projects in post-war Sri Lanka.