A former Sri Lankan market regulator urges authorities to launch an independent study to re-examine the recently introduced market regulations.
Former Director General of the Securities and Exchange Commission Channa De Silva speaking to News360.lk said, “All market regulations that were brought in the recent past should be re-examined from an independent standpoint”.
He believes doing this is important, especially for the regulations that were introduced during the last 12 month period.
De Silva’s comments come in the wake of the resignation of the SEC Chairman Thilak Karunaratne last Friday, citing intense pressure from certain quarters, which he did not name.
Further speaking to News360.lk, Channa De Silva said, he feels that certain regulations introduced in the recent past might have been rushed due to the rivalry existed between the regulators and the market players.
“Market conditions and market driving forces have completely turned around during the last 1 year and thus regulations introduced during this era may even be counter productive and sometimes even not relevant in today’s context and thus may require revisiting them to see the applicability of them and it’s conduciveness to the market” he added.
According to him, some regulations have made it difficult for companies to list in the stock market.
“Some regulations have made it extremely difficult for the firms to list on the Diri Savi Board” De Silva noted.
Meanwhile, he suggests that all stakeholders should join together to take the market forward.
De Silva believes, the stock market is the principal market in an economy and if it functions properly, other markets too will follow its path.
“Private equity, venture capital, and other fund raising markets dry up when equity market is bleeding” added the former regulator who is now functioning as the Chairman of Lanka Ventures.
He also says, when the stock market is down all business sentiments including the interest to start or grow businesses decline rapidly and thus have a great negative effect on the economy at large.
Sri Lanka’s Securities and Exchange Commission saw two Chairpersons resigning within a period of 8 to 9 months.
Mrs. Indrani Sugathadasa, who was the Chairman of the SEC, before Karunaratne, resigned in December 2011, saying that she wants to uphold her principals.
“We have to close that chapter very soon” added De Silva.
“Its time to push the start button” he concluded.