Global risks account for 26% of risks identified in H2 2026 Share rises from 14% in first halfGeopolitical tensions, global economic uncertainty drive increase
Global macroeconomic risks have emerged as the biggest perceived threat to Sri Lanka’s financial system, overtaking all domestic concerns as their share nearly doubled in six months, according to a Central Bank of Sri Lanka (CBSL) survey of 158 financial institutions.
Global risks accounted for 26% of risks identified by respondents in the second half of 2026, up from 14% in the first half, according to the CBSL’s latest Systemic Risk Survey. This was the highest share recorded for the category in the survey rounds published and nearly four times the 6.9% recorded in the second half of 2024.
The Central Bank’s Macroprudential Surveillance Department said that the increase largely reflected heightened concerns over geopolitical tensions and potential spillovers from other countries, together with uncertainty surrounding the global economic outlook.
The rise came as concerns over domestic risks eased. Fiscal and sovereign-related risks fell to 12.3% from 15.4%, while general domestic macroeconomic risks slipped to 16.6% from 17.6%.
Risks related to financial institutions, which ranked as the top concern in the previous survey at 19.4%, dropped to 14.1%. Financial market risks fell to 14% from 15.7%.
Financial infrastructure was the only other risk category to record an increase, climbing to 12.5% from 9.3%.
Respondents also reported a slight increase in the perceived probability of a high-impact negative event affecting financial system stability over the next year. However, the perceived probability over the next three years declined slightly.
Despite the shift, confidence in the financial system improved over both the short and medium terms, the survey found.
The survey, conducted from 17 July to 14 August, covered risk officers from licensed banks, finance companies, insurers, primary dealers, unit trusts, stockbrokers, licensed microfinance companies, rating agencies, and e-money providers, among others. It recorded a 100% response rate.
– By Priyanwada Abeyrathna