SEC urges stakeholders to step in creating a more capital-friendly market

From left: SEC Director Supervision Dilum Mahawatte, Director General Chinthaka Mendis, Chairman Faizal Salieh, CSE CEO Rajeeva Bandaranaike and Deputy Director General SEC Tushara Jayaratne  

In an effort to have a vibrant stock exchange, the Securities and Exchange Commission (SEC) called on stakeholders to step up efforts in creating a more capital-friendly market, for which further collaboration is needed with the market regulator.
The SEC Chairman Faizal Salieh  urged the market intermediaries to work closely with the Commission in the new year and engage in doing “the right thing in the right way” in order to build and strengthen the capital market’s integrity among investors. 
While asking the industry players to have a positive mindset to help the country come out of the economic crisis, Salieh requested the stock brokers to actively pursue and attract capital flows by engaging with investors. 

Currently, the market composition mix is about 11 percent foreign investors and 89 percent local investors and the country needs to attract more foreign investors. 

The Chairman stressed that a positive mindset and persistent hard work is essential to bring in new investments amidst challenging economic conditions, and cautioned against negativism, negative thinking and behaviour which are counter- productive to the growth of the capital market.
The SEC also stressed on the need of having a sound Order Management and Broker Back Office System across the stock broking industry to ensure stability and continuity. 

According to the Colombo Stock Exchange (CSE), this endeavour was thoroughly examined during the recent CSE Board meeting and will be addressed expeditiously. The industry stakeholders along with the CSE are set to engage in further active discussions to formulate a feasible solution, taking into account the various perspectives presented during the meeting.
Further, the SEC stressed the importance of obtaining prior consent from clients for the execution of transactions and highlighted the need for stock brokers to capture and document such consent properly. Accordingly, the proposed amendments to the Trading Participant Rules will be looked into and the necessary efforts will be taken.

The series of meetings held by the capital market operator and regulator was attended by SEC Chairman Faizal Salieh, Director General SEC Chinthaka Mendis, Deputy Director General SEC Tushara Jayaratne, CEO Colombo Stock Exchange (CSE) Rajeeva Bandaranaike, CSE’s Chief Regulatory Officer Renuke Wijayawardhane, SEC Director Supervision Dilum Mahawatte, along with other officials of both the SEC and CSE.