The International Monetary Fund's (IMF) executive board has approved a three-year $1.5 billion loan to support Sri Lanka's economic reform agenda, the global lender said on Saturday.

"The arrangement aims to meet balance of payments needs arising from a deteriorating external environment and pressures that may persist until macroeconomic policies can be adjusted," the IMF said in a statement, the Reuters news agency reported.

The decision will enable an immediate disbursement of $168.1 million and the remainder will be available in six instalments subject to quarterly reviews, the IMF also said.

Sri Lanka came to this agreement in late April with the IMF, subject to the approval by the executive board of the international lender.