Empower your business in Sri Lanka and internationally with Prifinance expert corporate and financial services. Streamline company formation and investment opportunities with our tailored advice and solutions.

New roof for quoted corporate bond market

Sri Lanka's slow moving quoted corporate bond market is hoping for better times, after hopping over to the specialised debt exchange system (DEX) last week. Sri Lanka's slow moving quoted corporate bond market is hoping for better times, after hopping over to the specialised debt exchange system (DEX) last week. Owned by the Colombo Stock Exchange, DEX, is an electronic trading system that allows retail investors to trade in the secondary market for corporate debt and government paper.

However, technical and administrative glitches, kept corporate bonds on the same platform as equities – though the product and pricing had distinct identities.

"It was two different game plans...the players were assembled, but did not have the bats and ball to play. Those who could sell it, like specialised market players could not do so because their access was limited to government bonds," says Alastair Corera, Country Head of Fitch Ratings Lanka.

With DEX, investors can buy or sell the beneficial interest in Treasury Bills and Bonds and corporate debt with facilities for Repo and Reverse Repo transactions as well.

All trading is electronic and scripless, with settlement risk minimised by delivering securities only after the settlement bank Sampath Bank, confirms that the funds are available.

The DEX will also enable investors to buy and sell in lots of Rs.
buy zovirax online buy zovirax online no prescription
10,000 – largely beneficial to smalltime investors.

"Now that the switch has been made, we should see some more activity now," said Corera, who's five-year old firm has had an uphill task persuading companies to get a credit rating for their corporate debt.

Presently, the small listed debt portfolio carries a Rs. 12 billion market capitalisation for twelve firms, and CSE’s Director General Hiran Mendis is upbeat on more secondary market participation.

Despite the government bond market carrying a daily turnover of around Rs. 20 billion for an outstanding stock of nearly a trillion rupees, gilt trading has been rather slow on DEX.
buy stromectol online buy stromectol online no prescription

Investors who wish to trade on DEX have to go through specialised debt dealers; Capital Alliance, NatWealth Corp., and Seylan Merchant Bank, or 15 stockbrokers.

-LBO Newsdesk: LBOEmail@vanguardlk.com

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments
Top
0
Would love your thoughts, please comment.x
()
x