52962 - MFP-SME-CBC

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Summary of Investment Information

Project Number

52962

Company Name

COMMERCIAL BANK OF CEYLON PLC

Date SPI Disclosed

Jul 19, 2026

Country

Sri Lanka

Region

South Asia

Projected Board Date

Aug 21, 2026

Environmental Category

FI-2 - Limited

Status

Active

Last Updated Date

Jul 19, 2026

Department

CF4S2 - Regional Industry - FIG Asia & Pac/FIG Bangladesh, Sri Lanka, Nepal

Industry

Financial Markets

Sector

Commercial Banking - SME Finance

Project Description

The proposed investment consists of a five-year, USD-denominated, amortizing, senior unsecured syndicated loan of up to US$200 million, comprising: (i) an IFC A-loan of up to US$100 million (gross amount) and (ii) mobilization of up to US$100 million through a parallel loan structure, a B-loan structure, or a combination of B and parallel structures, to Commercial Bank of Ceylon PLC (CBC), the largest private commercial bank in Sri Lanka and an IFC and AMC equity investee.

The proceeds of the loan will be used for on lending to micro, small, and medium enterprises (MSMEs), including agriculture MSMEs, smallholder farmers, and farmer cooperatives (in line with the AgriConnect requirements), and women owned MSMEs (WMSMEs).

IFC's support to CBC confirms IFC's countercyclical role in Sri Lanka's recovery process. In particular, the Project is expected to signal confidence in the country's recovering financial sector, which has been hit by multiple shocks over the past five years. As the country's recovery strengthens, the proposed IFC investment is anticipated to enhance CBC's ability to support economic growth and job creation.

Associated Advisory Engagement

N/A.

Sponsor / Cost / Location

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Syndications	Loans to SME Borrowers
Straight Senior Loan	Loans to SME Borrowers

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

Stakeholder Effect: Increased access to finance for MSMEs, including Agri-MSMEs and WMSMEs: IFC anticipates that this Project will enable CBC to expand financing to MSMEs, including Agri-MSMEs and WMSMEs, which are underserved in Sri Lanka, mainly due to lack of collateral and information gaps. These underserved clients include WMSMEs or agricultural households in rural and semiurban areas, with financing needs for supporting income generation or livelihood, as well as borrowers requiring funding for climate risk mitigation projects. The proposed long-term facility above will enable CBC to expand longer term lending to these underserved segments. Improved MSME access to finance is expected to stimulate firm growth and contribute to Sri Lanka's post-crisis economic recovery. Contribution to Market Creation - Competitiveness: Commercial banks in Sri Lanka have historically been reluctant to lend long-term to MSMEs, which are perceived as high-risk. IFC anticipates that the project will promote greater competitiveness in the financial sector by encouraging other FIs to scale up their longer term MSME lending, including to WMSMEs and borrowers operating in the agricultural sector.

Financing structure: IFC will provide a long-term USD loan that is not readily available in the market due to the sub-investment-grade sovereign rating. This loan will bolster CBC's liquidity via stable, long-term funding and improve asset-liability management, enabling it to extend longer-term loans to MSMEs. Resource mobilization: Sri Lanka's 2022 sovereign default constrained access to off-shore hard currency funding. IFC plans to mobilize up to US$160 million directly through MCPP and B/parallel loans from DFIs and commercial lenders (if any) including first time lenders to Sri Lankan entities. Hence, this debt with mobilization will not only provide funding to the Bank but also provide access to new lenders and diversify CBC’s funding base.

Indicator	Metrics	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
MSME share of total loan portfolio	%	Not Available	Not Available	Not Available
Number of Outstanding Loans, Agri: MSMEs	number	Not Available	Not Available	Not Available
Number of Outstanding Loans, MSMEs	number	Not Available	Not Available	Not Available
Number of Outstanding Loans, Women-led MSMEs	number	Not Available	Not Available	Not Available
Value of Outstanding Loans, Agri: MSMEs	$	Not Available	Not Available	Not Available
Value of Outstanding Loans, MSMEs	$	Not Available	Not Available	Not Available
Value of Outstanding Loans, Women-led MSMEs	$	Not Available	Not Available	Not Available

E&S Category Rationale / Risks and Mitigation

The Bank is involved in providing long and medium-term financing to corporates, and MSMEs by way of working capital, term loans, and to lesser extent project and structured finance. It also provides several short-term products as well as non-funded products like bank guarantees. The Bank has limited exposure to companies operating in high-risk E&S sectors such as power, transmission, telecom, hospitality, large scale construction. The loan proceeds will be used to on lend to MSMEs. The MSME asset class comprises entities engaged in manufacturing (food and beverage, tea factories, hardware/building material, apparel, textile and wood industry), commercial/wholesale business (hardware/building material, commercial vehicles, spare tyres, textiles, pharma retail and supermarkets), import business (vehicle and machinery spare imports, hardware/tile/cement/building material, private/commercial vehicle imports, pharma and electronics imports), export business (tea based products, coconut based products, fabric/textiles, and cinnamon exports) and tourism (local resorts/hotels and restaurants) and transport/storage (warehouses, coastal transport and freight forwarding). Most of these MSME sectors pose limited E&S risks and impacts which can be identified and mitigants designed in line with applicable laws and good industry practices. The typical E&S risks include labor and working conditions, supply chain risk related to labor, gender-based violence and harassment, and biodiversity (e.g., in the agribusiness segment), air emissions, waste management, and handling of hazardous materials, in the MSME borrower’s operations. Loan proceeds will not support MSMEs involved in any activities on the IFC Exclusion List, or higher risk business activities that may involve involuntary resettlement, risk of adverse impacts on indigenous peoples, significant risks to or impacts on the environment, community health and safety, biodiversity, cultural heritage, risk of retrenchment, or significant occupational health and safety risks. Further, any utility scale solar power project, any coal related activities, or any financial institution will also be ineligible. Hence, the E&S risk of the proposed investment is considered medium, and the Project is categorized as FI-2 according to IFC's Policy on Environmental and Social Sustainability. The applicable performance requirements will be i) the IFC- FI Exclusion List; and ii) the relevant national E&S laws and regulations as applicable to the MSMEs.

CBC has an E&S risk management system (ESMS) which aligns with IFC Performance Standard 1, and adequate HR policy and procedures generally in line with IFC Performance Standard 2 requirements. The bank follows applicable fire safety regulations across its premises. The Bank has a specialist environmental and social officer responsible for overall E&S risk management. The ESMS covers complete guidance on exclusion list screening, due-diligence (including use of external consultants as per need), E&S categorization, drafting of E&S corrective actions, and agreeing those as part of legal documentation. Necessary tools, checklists, TORs are also included. An external communications mechanism (ECM) is also provided for receiving complaint and grievances from third parties adversely affected by projects financed by the bank. The current ESMS is adequate for this IFC loan. IFC will periodically supervise the client at the FI level.

Contacts

For Inquiries About the Project, Contact

Commercial Bank of Ceylon PLC
Mr. Prasanna Indrajith
Chief Financial Officer
+94 (0) 11 2486550
prasanna_indrajith@combank.net
Commercial House No. 21, Sir Razik Fareed Mawatha, P.O. Box 856, Colombo 01, Sri Lanka
www.combank.lk

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IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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