Mock Runs

The Central Bank plans to start mock runs for scripless trading on government securities next week after parliament approved the legislative amendments.
Deputy Superintendent Public Debt, Dr. W M Hemachandra says trial runs for market participants starts off on Dec. 9, with live runs schedule to take place at the end of January.rn

rnAmendments to the Registered Stock and Local Treasury Bills Ordinance was approved by Parliament last Friday and is now before the Speaker, Hemachandra told Lanka Business Online.rn

rnThe Central Bank became the first in the South Asian region, to have its inter-bank payment and settlement system go live in September.rn

rnThe Rs. 900 mn Real Time Gross Settlement system comes with a depository and settlement system for scripless trading, but it does not actually have an integrated front-end trading interface, or a communications backbone.rn

rnBut scripless trading on government bonds could not join the inaugural party, as Cabinet had not amended the laws by that time.rn

rnMeanwhile, the bank plans to borrow Rs. 25.5 bn from the local market this month. rn

rnBut fresh issues will be limited to three billion rupees worth of two-year treasury bonds, as the bank is expecting over five billion rupees worth of privatisation receipts.rn

rnA bulk of the proceeds will come from the sale of a third of Ceylon Petroleum Corp.s assets to Indian Oil Corp. Petroleum sector analysts put a US$ 75 mn price tag on IOCs assets, though neither party is willing to comment.rn

rnThe funds are expected in the coming weeks.rn

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-Mel Gunasekera: melg@vanguardlanka.comrn