Given the significant changes that have occurred in the recent year, it is imperative to have a mechanism in place for the Colombo Stock Exchange (CSE) to conduct all core activities of the stock market digitally as well as to have measures in place to ensure electronic clearing and settlement in order to keep abreast with the development of technology, said SEC Chairman Viraj Dayaratne PC.
“The CSE had plans and they took various steps in order to digitize the system. So we need to have an end- to- end digitized market. So in that respect I have appointed a joint-committee comprising members of the SEC and the CSE. I appointed that committee on the 30 April. The CSE has nominated its members and now we are working on it and the market will be ready to operate digitally,” he said whilst joining for a live discussion with Indeewari Amuwatte on First at 9.
Further regarding the closure of the stock exchange, the SEC Chairman expressed the following;
“Rather than saying closure of the market I would say it was the inability for the market to open and continue with trading. We must understand that these are unprecedented times and a curfew was imposed by the government with strict conditions. So, the Securities and Exchange Commission of Sri Lanka had to consider whether the market could function in those circumstances. We did not take a decision on our own we had a continue dialogue with the Colombo Stock Exchange and we explored the possibility of having the market open. We did not only discuss this issue with the Colombo Stock Exchange but also with other stakeholders who expressed their concerns. What we needed to consider here was whether it was possible to open the market,” he said.
Speaking further he expressed confidence about the stock market’s future outlook.
“The outlook is positive. I mean what we have seen during the last five days. Of course what happened on the first day was totally unexpected. We as a regulator had to ensure that we had a mechanism in place to safeguard the interest of all stakeholders and the investors as well. If there was a sudden unexpected drop in their portfolio value we had to have a mechanism in place. Hence the “circuit breaker mechanism”, all though there were some criticism at the beginning has proved to be a success. The market has recovered, which is a positive sign,” he said.
“This is an unusual situation. I think we should be hopeful. We have seen worse times and we have bounced back. So we have to have a positive outlook. I as the chairman of the SEC is very confident and I hope we will get over this negativity and be optimistic and positive,” he added.
