People’s Bank, Sri Lanka’s largest state-owned bank by branch network and customer reach, posted a record profit after tax of Rs. 40.2 billion in 2025, completed the country’s largest-ever debenture issue, and won recognition from Euromoney as Sri Lanka’s Best Digital Bank for the second consecutive year.
The results came as the bank moved away from its traditional role financing state enterprises towards competing for private sector business, a strategic shift that Clive Fonseka, Chief Executive Officer and General Manager at People’s Bank, has made the centrepiece of his tenure.
Echelon spoke with Fonseka about the priorities for Sri Lanka’s post-crisis economy, what it means to run a bank with a public mandate in a competitive market, and what it takes to move an institution with 750 branches and 15 million customers into the digital age.
Sri Lanka has stabilised since the crisis, but long-term growth will require deeper structural change. What do you believe are the country’s biggest economic priorities over the next five years?
Sri Lanka has made important progress in restoring stability. So now it is important that the next five years is about converting stability into sustainable growth. That requires structural reforms that strengthen productivity, improve investor confidence, expand exports, and create a more competitive economic base.
In my view, the key priorities are clear. We must build a stronger export-oriented economy, deepen private sector investment, improve public sector efficiency, strengthen fiscal discipline, and ensure that the benefits of recovery reach all parts of the country.
Agriculture, small and medium-sized enterprises (SMEs), tourism, renewable energy, logistics, and digital services can all play a major role in this next phase.
Financial institutions also have an important responsibility. Banks must not merely finance growth; they must help shape responsible growth.
At People’s Bank, we see our role as supporting economic activity across the island while maintaining strong credit discipline, financial inclusion, and long-term stability.
People’s Bank has delivered strong results in a recovering economy. What has driven this performance, and where do you see the next phase of growth coming from?
Our performance reflects the strength and resilience not only of the institution, but also the trust that Sri Lankans continue to place in People’s Bank.
Over the past year, we delivered record profitability and strong balance sheet growth while navigating a complex environment and absorbing the impact of legacy challenges, particularly in relation to state-linked exposures.
A major driver of this success was our business model transformation. Historically, as a state-owned bank, we played a significant role in supporting state sector financing. While that national role remains important, we have deliberately shifted towards competing more actively for quality private sector business.
This required changes in strategy, credit governance, human capital development, customer engagement, marketing, and operational discipline.
The next phase of growth will come from quality lending, stronger private sector participation, digital banking, SME development, cards and payments, trade finance, and more sophisticated customer solutions.
Our focus is not growth at any cost. It is profitable, responsible, and sustainable growth.
AI, digital disruption, and changing customer expectations are reshaping the industry. What will define the next decade of banking, and how is People’s Bank preparing for it?
The next decade of banking will be defined by intelligence, immediacy, trust, and inclusion.
Customers will expect banking to be seamless, personalised, secure, and available wherever they are. At the same time, banks will have to operate in a more complex environment involving cyber risk, data governance, AI ethics, and evolving regulation.
For People’s Bank, technology leadership is one of our central brand pillars.
But technology is not only about launching apps or digital channels. It is about improving decision-making, reducing friction, strengthening risk management, enhancing service quality, and making banking more accessible to millions of people.
We are investing in digital platforms, data analytics, process automation, AI-enabled customer engagement, and secure payment solutions.
Given our scale and customer base, our digital transformation has national significance. When People’s Bank digitises, it brings millions of Sri Lankans closer to the formal financial system.
Technology is only one part of transformation. What has been the biggest challenge in driving change across an institution as large and established as People’s Bank?
The biggest challenge is not technology itself; it is mindset.
In a large institution with a long history, transformation requires people to embrace new ways of thinking while preserving the values that made the institution strong.
People’s Bank has a proud legacy, but we must ensure that legacy becomes a platform for the future rather than a comfort zone.
That means building agility, strengthening accountability, improving customer responsiveness, and encouraging innovation across all levels of the organisation.
We have focused heavily on human capital development, capacity building, governance, and internal alignment.
Our employees understand that the Bank’s future depends on combining institutional trust with modern capability.
Transformation succeeds when people believe in the direction, understand their role, and feel equipped to deliver.
People’s Bank has a unique role as both a commercial bank and a national institution. How do you balance profitability with the responsibility of supporting economic development?
For People’s Bank, profitability and national responsibility are not contradictory. In fact, a financially strong People’s Bank is better positioned to serve the country.
Profitability gives us the strength to lend, invest, innovate, support communities, and withstand shocks.
The balance lies in disciplined decision-making.
We support national priorities, SMEs, agriculture, exports, public sector projects, and underserved communities, but we must do so with sound credit judgement, strong governance, and responsible pricing.
Public trust is one of our most valuable assets, and we cannot compromise it.
Our nation-mindedness is not simply a slogan. It is reflected in how we support customers during crises, how we promote financial inclusion, how we invest in digital access, and how we undertake CSR and sustainability initiatives that go beyond immediate commercial returns.
“While that national role remains important, we have deliberately shifted towards competing more actively for quality private sector business.”
SMEs, entrepreneurs, and emerging industries will shape Sri Lanka’s future economy. Where does People’s Bank see the greatest opportunity to accelerate growth and investment?
SMEs are central to Sri Lanka’s future. They create employment, support regional economies, drive innovation, and strengthen domestic value chains.
The greatest opportunity lies in helping SMEs become more formal, more resilient, more productive, and more connected to markets.
People’s Bank has a unique advantage because our branch network, which is the largest in the country, extends across the island.
We understand customers not only in Colombo, but in every district and community. That gives us the ability to identify emerging entrepreneurs, support regional industries, and provide financial solutions that are relevant to local realities.
We see strong opportunities in agriculture modernisation, food processing, tourism, renewable energy, women-led enterprises, digital commerce, logistics, and export-linked businesses.
Our role is to provide not just finance, but also guidance, mentoring, digital tools, and long-term partnership.
As People’s Bank marks its 65th anniversary, what has enabled the Bank to remain relevant across generations, and what must it do to remain relevant for the next generation?
People’s Bank has remained relevant because it has always been close to the people.
Across generations, the Bank has served families, workers, farmers, entrepreneurs, professionals, public servants, and businesses. That deep emotional and practical connection is difficult to replicate.
But relevance cannot be taken for granted.
The next generation will judge banks differently. They will expect speed, transparency, digital convenience, personalisation, and strong values. They will also expect institutions to contribute meaningfully to society and the environment.
To remain relevant, People’s Bank must continue to evolve around our three brand pillars: superior customer experience, technology leadership, and nation-mindedness.
We must be modern without losing trust, competitive without losing purpose, and innovative without losing our connection to the people.
“For People’s Bank, profitability and national responsibility are not contradictory. In fact, a financially strong People’s Bank is better positioned to serve the country. Profitability gives us the strength to lend, invest, innovate, support communities, and withstand shocks.”
If we were having this conversation 10 years from now, what would success look like for People’s Bank, the banking sector, and Sri Lanka?
Ten years from now, success for People’s Bank would mean being recognised not only as the largest state-owned bank, but as one of the most customer-centric, technologically advanced, and trusted financial institutions in the region.
It would mean that we have helped millions of Sri Lankans move confidently into digital banking, supported thousands of SMEs to scale, and contributed meaningfully to national development.
For the banking sector, success would mean a stronger, better-capitalised, more innovative, and more internationally connected financial system. Banks should be catalysts for investment, productivity, exports, and inclusive growth.
For Sri Lanka, success would mean a more resilient, export-oriented, digitally enabled economy where growth is broad-based and opportunity is not limited by geography or background.
If People’s Bank can help make that future possible, then we would have fulfilled both our commercial ambition and our national purpose.