Pinocchio Promises or Real Confidence?

The Central Bank of Sri Lanka wants you to believe the financial system is finding its feet again — but is it real growth or just another long nose?

According to the Systemic Risk Survey for the second half of 2025, confidence in the short term has picked up. Respondents say the chance of a high-impact financial disaster right now looks lower than before.

But zoom out a little and the picture gets murkier. In the medium term, confidence slipped, with more players whispering about risks on the horizon — from geopolitical tensions to the shaky global economy.

The survey draws from the risk officers of banks, finance companies, insurers, brokers, microfinance outfits, even rating agencies. In short, the very people who keep an eye on the cracks in the system.

CBSL insists these are just “perceptions,” not its own view. Still, the gossip takeaway is simple:

In the short run, the system looks steadier. But scratch the surface and doubts linger — enough to make Pinocchio’s nose twitch.