The government stands only to safeguard the greater interest and stability of the financial system, not each and individual depositor’s interest irrespective of their mysterious conduct or imprudent risk taking behavior, Secretary to the Treasury and Ministry of Finance R.H.S Samaratunga said.
Delivering the keynote speech at the 22nd convocation of Institute of Bank of Sri Lanka, held in BMICH, last week, Samaratunga noted that Sri Lanka has been confronted with number of financial frauds and is still struggling to resolve or avert any possible crisis.
“Such crisis and failures can be taken your lifetime or hard-earned wealth overnight. When there is a crisis, people always tend to blame the government and ask for bailouts. If the government is to bailout the risk takers when they lose money, the rest of the public should be prepared to pay in two different ways, by paying additional taxes or foregoing existing government services.”
Risk is the possibility of losing money;, he said, adding that at the same time money is an asset that gives a return in various ways, in various amounts.
Samaratunga stressed that banks and financial service providers need to be mindful of managing risks of money, businesses, and various other industry related things. According to him, all stakeholders of the financial system must play their role to keep the system stable.
“Depositors, borrowers, investors,board of directors, shareholders, employees, auditors and regulators are the stakeholders for the system. They together keep the system stable assisted by government’s policy support,” he said.
Samaratunga further noted that no government will or can compromise the role of these stakeholders.
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