Malaysian group to help in Lanka’s capital market development

By Natasha Gunaratne

The Securities and Exchange Commission (SEC), concluded a first round of talks with a Malaysian party on a new Capital Market Development plan which SEC Director General Channa De Silva said is approaching implementation.

In the plan, the SEC envisages creating a vibrant capital market with greater participation from local investors including the rural population. Mutual funds are seen as a big player in supporting this aspect. As this develops, they are hoping to see industry growth with more asset management companies and more schemes, offering greater options for the investor.

It hopes to introduce derivatives to the market. De Silva also said they are rebuilding a new index for the stock market and are taking a closer look at their surveillance system. An Indian firm specialising in electronic filing was expected to visit Sri Lanka this past week for discussions on implementing such a system. De Silva said the electronic filing system should benefit stockbrokers and companies soon, by easing concerns on speed and efficiency.

The SEC is also planning to initiate a programme to train journalists outside of Sri Lanka on the 'stock market and the fixed income angle.' The journalism training initiative is aimed to educate them on the progression of overseas markets such as Thailand and Malaysia and to showcase this to the public.

Furthermore, the SEC plans on using 'unorthodox but effective measures' to be taken for at least 5 – 10 companies to list their shares on the market. With the input of local and foreign experts, they are keen on analyzing the factors which influence companies to come to the market.