Finance companies can handle leasing anything below Rs. 5 million and this sector would also not be affected.

A top level discussion between the Central Bank Governor Dr. Indrajit Coomaraswamy and senior bank officials ended in a dead following representations made by them heavily lobbying for the retaining of leasing business under their belt, A Bank General Manger who participated in the meeting recently said.

According to the budget proposal the ban on commercial banks from engaging in leasing was scheduled to be implemented from June 1, but a decision has been taken to restrict the commercial banks exposure to leasing without banning it altogether.

Handing over leasing totally to finance companies is a risk for consumers as some of them have weaker asset quality and also face liquidity problems, the official said adding that they will have to curtail the number of employees engaged in the leasing division or to get rid of them if the bank is confined to its core business or restricted it.