Sri Lanka has paid $50 million to Bangladesh, the final instalment of a $200 million loan taken under a currency swap agreement two years ago, a top Bangladesh Bank official said yesterday.

The government of the island nation also paid $4.5 million as interest on the loan amount on Thursday, the official said.

Colombo repaid $100 million on September 2 and $50 million on August 17.

Sri Lanka paid back its loan as its embattled economy is staging a recovery from its worst economic crisis just a year ago. Its inflation rocketed to 69.8 percent in September last year. In July, however, inflation stood at 6.3 percent.

On the other hand, Bangladesh is facing a foreign exchange crisis after its reserve dropped sharply in the past one and a half years owing to higher import bills compared to lower-than-expected remittance and export earnings.

The gross forex reserve came down to $21.45 billion on September 21 in line with the International Monetary Fund's calculation formula, BB data showed.