Reinforcing its position as Sri Lanka’s largest lender to small and medium enterprises (SMEs), the Commercial Bank of Ceylon has partnered with the International Finance Corporation (IFC), a member of the World Bank Group, to significantly expand the Bank’s capacity to lend SMEs nationwide.

Under this partnership, IFC will provide risk cover for a US$60 million (equivalent to over Rs. 18.5 billion) portfolio of new SME loans issued by Commercial Bank. By assuming 50% of the credit risk, this facility empowers the Bank to sustainably scale its lending capacity and solidify its standing as Sri Lanka’s premier SME lender. This agreement comes at a time when Sri Lanka is consolidating recovery and capitalising on emerging growth opportunities across key sectors.

The Risk Sharing Facility (RSF) will prioritise women-led enterprises and agri-businesses. This targeted approach directly promotes financial inclusion while strengthening productive sectors essential to Sri Lanka’s long-term resilience and economic expansion, the Bank said.

Supported by the IDA Private Sector Window Blended Finance Facility, through the Small Loan Guarantee Program (SLGP), the Facility further enables the Bank to adopt a more flexible approach to credit assessment. By prioritising long-term business potential where traditional security might otherwise be a constraint, Commercial Bank can now extend vital funding to segments that have historically faced barriers to finance. Beyond expanding the Bank's immediate lending headroom, this initiative is expected to catalyse broader market development by encouraging other financial institutions to enhance their own SME portfolios.

Commenting on the collaboration, Mr Sanath Manatunge, Managing Director/CEO of Commercial Bank said: “This risk sharing facility with IFC represents a powerful vote of confidence in Commercial Bank’s long-standing commitment to Sri Lanka’s SME sector. As the country navigates post-crisis recovery, sustained access to credit is essential for small and medium enterprises to rebuild, adapt and grow. This partnership allows us to expand our lending capacity responsibly, while prioritising customer segments such as WSMEs and Agri Sector that are critical to inclusive and resilient economic growth.”

He added that the initiative is firmly aligned with the Bank’s purpose-driven SME strategy. “For five years running, Commercial Bank has been the largest lender to SMEs in Sri Lanka because we recognise these enterprises as the backbone of the economy. By working with IFC to share risk and unlock new financing, we are strengthening our ability to stand with entrepreneurs who create jobs, sustain communities and drive national development.”

Mr Allen Forlemu, the IFC Regional Industry Director for Financial Institutions Group – Asia and the Pacific said the partnership underscored IFC’s commitment to strengthening access to finance where it matters most. “Real economic progress happens when entrepreneurs have the tools to turn their resources into thriving enterprises. Through this collaboration with the Commercial Bank of Ceylon, we aim to deliver targeted solutions to bridge the financing gap and expand financing capacity for small businesses across Sri Lanka. Our goal is to create a ripple effect: when these businesses succeed, they create jobs, support families, and build a more inclusive future. This latest initiative continues IFC’s more than two-decade partnership with Commercial Bank, advancing SME growth and economic resilience – fully aligned with the World Bank Group’s mission and supporting national development priorities.”

Commercial Bank has been Sri Lanka’s largest lender to Sri Lanka’s SME sector for the past five consecutive years, accounting for more than 30 per cent of total SME lending by the banking industry in 2024, according to Ministry of Finance data. This new facility builds directly on that leadership, allowing the Bank to further deepen its reach and impact among SMEs that play a vital role in employment generation, domestic production and economic resilience.

The collaboration also reflects a long-standing strategic partnership between Commercial Bank and IFC that dates back more than two decades. Over the years, IFC has supported the Bank’s growth through equity investments, funding and advisory services, with a shared focus on SME development, women’s economic empowerment, sustainable finance, digitalisation and economic resilience.

By building on its deep institutional partnership with IFC, Commercial Bank continues to reinforce its leadership in SME financing, combining scale, innovation and development-focused collaboration to support enterprises across Sri Lanka as they recover, expand and contribute to sustainable economic growth.

Commercial Bank is the first Sri Lankan bank with a market capitalisation exceeding US$ 1 Bn., and was also the first bank in the country to be listed among the Top 1000 Banks of the World.  Commercial Bank has the highest capital base among all Sri Lankan banks, is the largest private sector lender in Sri Lanka, and the largest lender to the country’s SME sector.  Ranked No. 1 in the Business Today Top 40, Commercial Bank is recognised as the most respected and most-awarded Bank in Sri Lanka. Commercial Bank is also a leader in digital innovation and is Sri Lanka’s first 100% carbon-neutral bank.

Commercial Bank operates a network of strategically located branches and automated machines island-wide, and has the widest international footprint among Sri Lankan banks, with 20 branches in Bangladesh, a fully-fledged Tier I Bank with a majority stake in the Maldives, a microfinance company in Myanmar, and a representative office in the Dubai International Financial Centre (DIFC). The Bank’s fully owned subsidiaries, CBC Finance Ltd. and Commercial Insurance Brokers (Pvt) Limited, also deliver a range of financial services via their own branch networks.

Photo caption: Mr Sanath Manatunge, Managing Director/CEO of Commercial Bank and Mr Allen Forlemu, the IFC Regional Industry Director for Financial Institutions Group – Asia and the Pacific, at the signing of the agreement.