National Savings Bank

The National Savings Bank was established on the 16th of March, 1972 under an Act of Parliament No. 30 of 1971, amalgamating the National Savings movement Ceylon Savings Bank, Post Office Savings Bank and Savings Certificates Section of the Post Master General’s Department.

NSB is the proud inheritor of a rich tradition of savings banking, dating back to the early 19th century. Tracing its history very briefly, on the 6th of August 1832, the Governor of Ceylon Sir Robert Wilmot Horton pioneered the establishment of the Ceylon Savings Bank. Business was slow at first as the bank was open only three days a week and transactions were in sterling pounds. Sir Ponnambalam Ramanathan, quick to detect the leisurely and bureaucratic operations of the bank, advocated a more efficient and customer conscious institution. The Post Office Savings Bank, finally established in 1885, effected easy access for deposits and withdrawals through the network of national post offices. For the first time in the nation’s history, a true bank for the little man opened for business as the Ceylon Post Office Savings Bank.

Then in 1941, reins of the Post Office Savings Bank were handed over to a Board of Trustees comprising the Permanent Secretary to the Ministry of Posts, the Deputy Secretary to the Treasury and the Postmaster General. The last two officials remain members of the Board of Directors of NSB even now.

The Ceylon Savings Bank and the Post Office Savings Bank were not the only two savings institutions. The Ceylon War Savings Movement set up in 1942, helped raise money for war loans and popularized the acceptance of savings certificates. After the war, its name was changed to the National Savings Movement.

The Savings Certificate section was opened in 1938 by the Postal Services Department to further perpetrate the savings function in the country.
By then there were three institutions functioning in the country for the purpose of mobilizing savings yet none of them were far reaching in their objective as they were limited in services. Even though the potential for savings banks was very high and the benefits to the economy were enormous, our savings institutions were not exploiting these opportunities. Comparatively our foreign counterparts were far ahead of us. There was a need for the authorities to create a stronger organization to fill the gap. Thus, the birth of the National Savings Bank into the banking system was engineered in 1972 by an Act of Parliament, keeping in line with the economic thinking of that period as a fully state owned institution.

On 16th March 1972, the National Savings Bank commenced its operations by an Act of Parliament to reach the goal of effectively channelling the idle money lying in every corner of the island towards the development process of the country. Hence the National Savings Movement, Ceylon Savings Bank and the Savings Certificates Section of the Postmaster General’s Department came to be defunct.

Under the new flagship, NSB did not take long to instill the savings habit. NSB surged forward and moved into all strata of life and transformed itself into a household name as a partner in savings. It offered many new products such as Save As You Earn, School Savings Units, Gift Tokens and Deposit Certificates etc., to cater to various needs of society. NSB also offered attractive incentives such as highest rates of interest, government security, tax relief and island-wide uni-banking through Post Office savings accounts. Since then there has been no looking back as NSB triumphantly marched into the future.