The Monetary Board has informed Lankaputhra Development Bank Limited Chairman Deshabandu Lasantha Goonawardena that he cannot remain in his position any longer. This announcement had been made by the Monetary Board after having obtained the Attorney General’s advice.

The Bank Supervision Department of the Central Bank of Sri Lanka had announced on 24 March 2016 that Lasantha Goonawardena could not continue further as Chairman of the Lankaputhra Development Bank Limited, subsequent to a ‘fit and proper’ examination which the Chairman had failed. This was due to his breaching the institutional good governance and confidentiality regulations based on the Banking Act.

However, while responding to the Monetary Board’s notice of 24 March 2016, company secretary to Lankaputhra Development Bank, Gamini Pitipana had informed the secretary to the Ministry of State Enterprise Development on 11 May 2016 that the particular decision of the Monetary Board had been recalled by Central Bank Governor Arjuna Mahendran.

However, during a monetary policy disclosure media conference on 30 August, a media person had questioned whether the Governor had the authority to individually recall a decision of the Monetary Board.

Following the Monetary Board seeking the advice of the Attorney General, it has been confirmed that under Clause 42 (7) of the Banking Act, Lasantha Goonawardena cannot continue as Chairman of Lankaputhra Development Bank any further.