Section No :  
1980 Revised version
MONETARY LAW
Marginal Notes
1. This Act may be cited as the Monetary Law Act.
2. The unit of monetary value.
3. The par value of the rupee. [ 8, Law 10 of I978.]
4. The use of the rupee.
5. Establishment and objects of Central Bank.
5A. Powers of the Central Bank and the Monetary Board in relation to section 69 A of the Inland Revenue Act, No. 4 of 1963. [56, 18 of 1965.]
6. Capital of Central Bank.
7. Place of business.
8. Constitution of Monetary Board. [2, Law 37 of 1974]
9. Monetary Board to be a body corporate.
10. General powers of Monetary Board.
11. Disqualification for appointment as Governor, or -as member of Monetary Board. [ 3, Law 37 of 1974]
12. Appointment, remuneration, & c., of Governor of Central Bank.
13. Term of office of Governor and appointed member, [ 4, Law 37 of 1974]
14. Remuneration of appointed member.
15. Alternate for appointed member.
16. Removal from office of Governor or appointed member.
17. Meetings of Monetary Board.[ 6, Law 37 of 1974.]
18. Attendance of certain officers at meetings of Monetary Board.
19. General functions and duties of Governor.
20. Governor to be principal representative of Central Bank and Monetary Board.
21. Delegation of powers of Governor.
22. Appointment of Deputy Governors.
23. Disqualification and removal of Deputy Governors.
24. Deputy Governor to act as Governor.
25. Establishment and functions of department of economic research.
26. Authority to obtain information.
27. Training of technical personnel.
28. Establishment and functions of department of bank supervision.
29. Examination of banking institutions.
30. Power of Monetary Board to suspend or restrict business of a banking institution.
31. Director of Bank supervision to be liquidator winding up of a banking institution.
32. Offences in regard to information and examinations.
32A. Scheme to in sure deposits held by banking institutions and co-operative societies. [ 7, Law 37 of 1974.]
32B. Insurance of deposits held by banking institutions of societies. [ 7, Law 37 of 1974.]
32C. Premiums payable on deposits.[ 7 Law 37 of 1974.]
32D. Examination of insured banks and insured societies, amp c.[ 7, Law 37 of 1974.]
32E. Regulations. [7,Law 37 of 1974]
33. Other departments.
34. Monthly statement.
35. Annual report. [8.Law 37 of 1974]
36. signatures on balance sheets and financial statements
37. Financial year.
38. Computation of profits and losses.
39. Distribution of profits.
40. Extraordinary expenses of currency issue and monetary stabilization.
41. Revaluation profits and losses.
42. Audit.
43. Powers and functions.
45. Duty to maintain secrecy. [ 8, Law 37 of 1974.]
46. Liability for False statements in Central Bank accounts, &c.
47. Protection for acts done in good faith, & c
48. Definition of "currency",
49. Issue power.
50. Prohibition against issue of person other notes by any person other than Central Bank.
51. Liability for notes and coins.
52. Currency to be legal tender.
53. Characteristics of currency.
54. Contracts for printing of notes and minting of coins.
55. Exchange of currency.
56. Replacement of currency unfit for circulation.
57. Retirement of old notes and coins.
58. Mutilation or defacement of currency notes.
58A. Use of currency coin otherwise than as legal tender. [ 2, 14 of 1979.]
59. Conclusive evidence of imitation of a currency note.
59A. Conclusive evidence of imitation of a coin or current coin. [ 2,5 of 1968.]
60. Definition of " demand deposits ".
61. Acceptance and creation of demand deposits.
62. Definition of " the money supply ".
63. Principles governing determination of domestic monetary policy.
64. Action to preserve monetary stability.
65. Principles governing determination of international monetary policy. [ 8, Law 10 of 1978.]
66. International Reserve.
67. Composition of International Reserve.
68. Action to preserve the international stability of the rupee.
70. Dealings in gold
71. Foreign exchange operations of central Bank
72. Purchases and sales of foreign exchange from or to commercial banks in Sri Lanka.
73. Parities of foreign currencies with respect to the rupee.
74. Exchange rates for Central bank transactions.
75. Loans to and from foreign institutions, & c.
76. Rates applicable to purchases and sales of exchange by commercial banks. [8,Law 10 of 1978.]
76A. Exchange rates for Central Bank and commercial bank transactions where parities of foreign currencies are not determined. [ 2. Law 16 of 1977.]
77. Control of foreign exchange holdings of commercial banks.
78. Requirements regarding currency positions of commercial banks.
79. Revaluation profits and losses on holdings of foreign exchange by banking institutions. [ 8, Law 10 of 1978.]
80. Information on exchange operations.
81. Capital movements.
82. Principles governing credit operations.
83. Types of operations authorized [ 88, 30 of 1971.]
84. Extension of maturities,
85. Loans to mortgage institutions.
86. Emergency loans and advances.
87. Interest and discount rates.
88. General conditions as to grant of credit facilities.
88A. Loans or advances to credit institutions.[ 67, 11 of 1963.]
88B. Instrument of assignment by way of pledge to the Central Bank to be free of stamp duty. [67, 11 of 1963.]
88C. Instrument of assignment by way of pledge to the Central Bank need not be registered under the Registration of Documents Ordinance. [67, 11 of 1963.]
88D. Notarial execution not required in the case of assignments by way of pledge. [ 67, 11 of 1963.]
88E. Medium and Long Term [ 67, 11 of 1963.]
88F. Interpretation. [ 67, 11 of 1963.]
88G. This Part of this Act to prevail over other written law. [67, 11 of 1963.]
89. Provisional advances to the Government
90. Principles governing open-market operations.
91. Authority of Central Bank to transact open-market operations.
92. Conditions as to issue of securities by Central Bank.
93. Reserve requirements.
94. Monetary Board to prescribe reserve ratios.
95. Fixing of special high ratios in time of inflation.
96. Computation of required reserves.
97. Consequences of reserve deficiencies.
98. Clearance and settlement.
99. Principles governing additional regulation.
100. Maturities of bank loans and security therefor.
101. Limitation of loans and investments of commercial banks.
102. Minimum capital ratios.
103. Margin requirements against letters of credit.
104. Fixing of interest rates,commissions and charges.
105. Conditions of eligibility of credit instruments for discount, & c, by Central Bank.
106. Central Bank lo be fiscal agent and banker of the Government.
107. Official depository of the Government.
108. Loan guarantees and loan insurance.
108A. Guarantee of loans to small-scale enterprises. [ 10, Law 37 of 1974.]
109. Other institutions as agents of Central Bank.
110. Remuneration for services.
111. Representation with foreign Governments, agencies, and international institutions.
112. Issue of Government securities
113. Management of the public debt.
114. Advice on Government credit operations.
115. Recommendations as to policy, & c, of Government agencies or institutions.
116. Monetary policy and Fiscal policy.[11, Law 37 of 1974]
116A. Transfer and use of dormant funds in commercial banks. [ 12, Law 37 of 1974.]
117. Business which Central Bank may not transact
118. Exemption from income tax, import duty, and stamp duty.
119. Acts of Monetary Board valid notwithstanding subsequent discovery of disqualification.
120. Officers and servants to be deemed public servants for purposes of Chapter IX of the Penal Code
121. Protection for banking institutions.
121A. Prohibition of use of words " bank " " banker " and " banking " in names of institutions other than banking institutions. [ 13, Law 37 of 1974.]
121B. No commercial bank to be established, no branch of a commercial bank to be opened, and no commercial bank to acquire business of another commercial bank, except with prior approval of Minister of Finance. [ 13, Law 37 of 1974]
122. Offences and penalties.
123. Offences by corporations.
124. Exclusion of application of companies Ordinance
125. Provision for conflict with other written law.
126. Defence (Finance) Regulations, & c.
127. Interpretation.
128. Validity of currency in circulation, & c.
129. Appointment of pensionable public officers to posts in central Bank,
130. Contributions by Central Bank in respect of pensionable public officers appointed to posts in the bank.