Comments on: The Central Bank Bond Controversy Revisited

By: Thilan

Thilan — Tue, 16 Jun 2015 04:22:00 +0000

Maybe I’m missing something here. Selectively providing material non-public information (MNPI) is a crime under the securities laws of almost every country in the world. If such alleged activities took place with this bond issue, the Central Bank and the relevant decision-makers should rightly be investigated and appropriately punished. However, in most countries it is the individuals and entities who act and profit from MNPI that are more severely punished. Recall Raj Rajaratnam and Galleon Investments. In this context, is there an investigation launched on the Primary Dealer who put these bids in? There is no need for the government to honour the bond terms if they were obtained under unfair means. If the insider trading allegations are in fact true, the regulators should look to cancel the Primary Dealer’s license and criminal proceedings should be launched against the principals – ideally with jail time. Narrow-mindedly going after the Central Bank seem more like settling a political vendetta rather than trying to recover losses for the country or inspire investor confidence. The irony of this sad episode is the fact that the chief charge is nepotism; an act the previous regime elevated to an art form.

By: Bell

Bell — Sun, 26 Apr 2015 13:41:00 +0000

The Public Debt Department of CBSL also should responsible for this, because they have the authority to reject any bid by PDU for higher rates as it will affect the economy. Also, when you increase the amount from Rs. 1.0 B to 10.0 B it is not a simple decision.

Somebody might decide this is acceptable, who did it?

By: rukmal

rukmal — Fri, 24 Apr 2015 17:49:00 +0000

In reply to Dev. this analysis misses the wood for the trees. cabral cleverly avoided a planned bond issue for usd 500 m and left the sirisena government in a bind. mahendran rescued it with some adroit interest rate moves. quibbling over these interest rate movements misses the point

By: Dev

Dev — Thu, 23 Apr 2015 12:32:00 +0000

CPA has already clearly addressed the issue of committees and commissions appointed in SL. This was another one of those (esp. with 3 UNP lawyers). No surprise.

The CB Governor was appointed by Ranil. Of course he is going to defend and protect him.

Let’s look at an example from UK (since Ranil is such a fan of the Westminster parliament and often quotes traditions from there)
On 14 October 2011 Liam Fox resigned from his office as Secretary of State for Defence, following controversy over his relationship with lobbyist Adam Werritty who had accompanied Fox on 18 trips abroad.

In fact Fox resigned BEFORE the investigation by the government (led by Sir Gus O’Donnell) was even COMPLETE.

That is the way it should have been.

Not only the CB Governor but also the PM should have resigned given his own involvement in appointing Arjuna Mahendran. Of course in this “land like no other” we carry on.

(Yes, I am aware things were worse under MR but criticism of this regime is not equal to support of the former)