Acting director general of the SEC Hareendra Disa Bandara said the two entities planned to encourage the listing of large private and public companies, attract new foreign and local funds, develop trading infrastructure and the corporate bond market.
Recent tax holidays for equity listings and lifting of withholding tax on debentures proposed in the budget will help this, he said. SEC will also amend its governing act and change definitions of some to make it easier to cut securities fraud.
Ajith Fernando, head of a newly established association of margin traders said the removal of stamp duty on stocks moved to margin accounts will remove one of the hassles.
The SEC and CSE will also intensify education efforts, develop mutual funds, and develop new products and demutualize the Colombo Stock Exchange into a listed company from the current broker owned process.Risk management systems will be strengthened by moving establishing a central counterparty, moving towards documents against payments and strengthening broker back office functions.
SEC chairman Nalaka Godahewa said some of the initiatives could be implemented quickly while the timelines for others will be set after a proposed presidential task force on capital markets is established.
In the meantime a task force of industry participants and regulators will be set up to carry forward each of the initiatives.