UPDATE-Today's Meeting

Posted for further discussion if possible

Formula to prop up Colombo market but shutting out ‘vested’ interests

Sri Lanka’s stock market authorities on Wednesday agreed on a face-saving formula to prop up the market but it was clearly spelt out that ‘personal agendas’ of individual investors won’t be met by the changes, informed sources said.

At a meeting chaired by Treasury Secretary Dr P.B. Jayasundera, Securities and Exchange Commission (SEC) Chairman Thilak Karunaratne agreed to a formula to revive the market in a way that would serve the interests of all investors and not those with individual agendas.

Officials of the Colombo Stock Exchange (CSE) were also present and together with the SEC made separate presentations of the state of the market, an opportunity that was not given to them last week.

The sources said that last Friday’s meeting was called by the President at the behest of high net-worth investors, particularly those who are struggling with huge debts from margin trading.

“These are the powerful but debt-ridden investors who want the market to move. One investor has at least Rs 1 billion in debt from margin trading from a private commercial bank which itself shouldn’t have lent so much to one individual. The Central Bank should be checking the accounts of this bank because of these irregularities,” one source said.

Dr Jayasundera, who is said to have conducted a cordial meeting, was quoted as saying owing to political considerations the market needs to move up and suggested that some confidence-seeking measures may need to be introduced.

The SEC then agreed to come up with a formula whereby credit would be more ‘generous’ than before but not to ill-liquid stocks and those involved in ‘pump and dump’ trading, which in the first place led to the market collapse.
http://sundaytimes.lk/index.php?option=com_content&view=article&id=22248:update-formula-to-prop-up-colombo-market-but-shutting-out-vested-interests&catid=77:news&Itemid=563

Sriranga,Thank you for the information, hope for the best!

sriranga wrote:Posted for further discussion if possible

Formula to prop up Colombo market but shutting out ‘vested’ interests

Sri Lanka’s stock market authorities on Wednesday agreed on a face-saving formula to prop up the market but it was clearly spelt out that ‘personal agendas’ of individual investors won’t be met by the changes, informed sources said.

At a meeting chaired by Treasury Secretary Dr P.B. Jayasundera, Securities and Exchange Commission (SEC) Chairman Thilak Karunaratne agreed to a formula to revive the market in a way that would serve the interests of all investors and not those with individual agendas.

Officials of the Colombo Stock Exchange (CSE) were also present and together with the SEC made separate presentations of the state of the market, an opportunity that was not given to them last week.

The sources said that last Friday’s meeting was called by the President at the behest of high net-worth investors, particularly those who are struggling with huge debts from margin trading.

“These are the powerful but debt-ridden investors who want the market to move. One investor has at least Rs 1 billion in debt from margin trading from a private commercial bank which itself shouldn’t have lent so much to one individual. The Central Bank should be checking the accounts of this bank because of these irregularities,” one source said.

Dr Jayasundera, who is said to have conducted a cordial meeting, was quoted as saying owing to political considerations the market needs to move up and suggested that some confidence-seeking measures may need to be introduced.

The SEC then agreed to come up with a formula whereby credit would be more ‘generous’ than before but not to ill-liquid stocks and those involved in ‘pump and dump’ trading, which in the first place led to the market collapse.
http://sundaytimes.lk/index.php?option=com_content&view=article&id=22248:update-formula-to-prop-up-colombo-market-but-shutting-out-vested-interests&catid=77:news&Itemid=563

A bit confused about the source of this article. On one hand it refers to today's (Wednesday) meeting but source at bottom seems to be the SundayTimes.
Can someone clarrify ?

This is regarding previous meeting. But Found this on anti government web site.
http://lankanewsweb.com/sinhala/index.php?option=com_content&view=article&id=2015:2012-07-23-10-17-24&catid=1:general&Itemid=53

"The SEC then agreed to come up with a formula whereby credit would be more ‘generous’ than before but not to ill-liquid stocks and those involved in ‘pump and dump’ trading, which in the first place led to the market collapse."

Very well said and thought. Keep going SEC.

slstock wrote:
"The SEC then agreed to come up with a formula whereby credit would be more ‘generous’ than before but not to ill-liquid stocks and those involved in ‘pump and dump’ trading, which in the first place led to the market collapse."

Very well said and thought. Keep going SEC.

Dear slstock in your opinion which way heding the market from tomorrow onwards....?

marusira wrote:

slstock wrote:
"The SEC then agreed to come up with a formula whereby credit would be more ‘generous’ than before but not to ill-liquid stocks and those involved in ‘pump and dump’ trading, which in the first place led to the market collapse."

Very well said and thought. Keep going SEC.

Dear slstock in your opinion which way heding the market from tomorrow onwards....?

As this is partly a mental game, I guess its too early to say. If ASI breaks 4950-500 first and then 5100 with heavy activity we can have some hope for some consistent uptrend.

Quite frankly, the ASI has been in 4700-5100 range since february. High time some holders get some relief.
Though market moved a bit here and there, the big cap shares hardly moved. Actually some like DIST, SAMP, RCL even further dropped.

sriranga wrote:
“These are the powerful but debt-ridden investors who want the market to move. One investor has at least Rs 1 billion in debt from margin trading from a private commercial bank which itself shouldn’t have lent so much to one individual. The Central Bank should be checking the accounts of this bank because of these irregularities,” one source said.

Gosh..! wonder who is this?
What's the point SEC change policies to make these kind of people profitable?
I think Bank officer should take the responsibility no one else.

"The sources said that last Friday’s meeting was called by the President at the behest of high net-worth investors, particularly those who are struggling with huge debts from margin trading."

Okay now we know officially ( ???) who are the troubled HNWI. I am sure there a few more more. There is one special person ( prominent) who comes to mind, who never got involved with these meetings. Also he seems to be more of an investor than a trader. So looks like he never got into that much trouble with speculatives

Anyway, I hope for the overall CSE benefit and retailers ( who hold decent shares and not gamblers) the market will give some short term relief.

slstock wrote:"The sources said that last Friday’s meeting was called by the President at the behest of high net-worth investors, particularly those who are struggling with huge debts from margin trading."

Okay now we know officially ( ???) who are the troubled HNWI. I am sure there a few more more. There is one special person ( prominent) who comes to mind, who never got involved with these meetings. Also he seems to be more of an investor than a trader. So looks like he never got into that much trouble with speculatives

Anyway, I hope for the overall CSE benefit and retailers ( who hold decent shares and not gamblers) the market will give some short term relief.

I think I can guess who came to your mind
Yeah he is a more of an investor and I cannt remember he attended any of these meetings. At his age I guess he prefers a bit laid back life style while enjoying a tea cup and an investment in a hospital. Which is understandable.

UKboy wrote:

sriranga wrote:
“These are the powerful but debt-ridden investors who want the market to move. One investor has at least Rs 1 billion in debt from margin trading from a private commercial bank which itself shouldn’t have lent so much to one individual. The Central Bank should be checking the accounts of this bank because of these irregularities,” one source said.

Gosh..! wonder who is this?
What's the point SEC change policies to make these kind of people profitable?
I think Bank officer should take the responsibility no one else.

Look at the recent warrant conversion for the answer...

Some ppl are good at marketing games but not playing it

I see some silver lining in the sky. Bourse responded positively to this news during the second half of trading yesterday. Investors need this type of strait play and not manipulation games.

I hope SEC has courage and also is smart enough to navigate through this stormy period. We are always with you SEC if you play the game strait without fear or favour. Thanks Dr.PBJ & H. E. the President for giving much needed space for the SEC to play its game as per the rules & be duty bound by the genuine investors. Happy trading every body.

Dr. PB tells SEC, CSE to revive stock market with innovative ideas
Published : 2:27 am July 26, 2012 | No comments so far | | E-mail to friend
Finance Ministry Secretary Dr. P.B. Jayasundera yesterday urged both the Securities and Exchange Commission (SEC), and the Colombo Stock Exchange (CSE) to come up with innovative new ideas to revive the stock market.
This was the key message during the near two-hour joint meeting between Dr. Jayasundera, the Commissioners of the SEC and Board members of the CSE.
Sources said the meeting, a direct follow up to President’s forum with capital market stakeholders on Friday, had discussed best means to revitalise the Colombo Bourse, which has been plagued by sustained bearish run and low activity.
SEC’s Acting Director General H. Dissabandara and CSE Chairman Krishan Balendra had made presentations at the meeting outlining some of their proposals, after which there had been a discussion on same.
Dr. Jayasundera had said that whilst what had been suggested was welcome, the Colombo Bourse needed more innovative new ideas for a robust rebound and sustainable development. The need for a revival via short, medium and long term executions had been emphasised.
Broker credit had figured in the discussion as well. Given the status quo of the stock market, the importance of pragmatic regulation benefitting all as well as more practical and innovative proposals for revival had been suggested as well. Dr. Jayasundera had said a further meeting would be convened as part of a continuous dialogue between the Finance Ministry, SEC and CSE.
The Colombo stock market is down 19% year-to-date with over Rs. 300 billion value wiped off on the back of an 8.5% negative return in 2011. In comparison to the Bourse’s all-time high of mid-February 2011, the loss of value is over Rs. 700 billion.
At Friday’s meeting with the President, brokers and high net worth investors listed a host of reasons for the market’s downfall and disenchantment on the part of investors, existing and prospective, whilst the SEC, CSE and a few other brokers gave their views as well.
http://www.ft.lk/2012/07/26/dr-pb-tells-sec-cse-to-revive-stock-market-with-innovative-ideas/