Senior Central Bank officials have sharply criticized stockbrokers for 'leaking' sensitive information to the media, alleging that this is holding back the development of capital markets in Sri Lanka, sources said.
The allegation had been made at a closed door meeting that the Central Bank had with the officials of the Securities and Exchange Commission, the Colombo Stock Exchange and stockbrokers on Tuesday.
Banking watchdog had charged that brokers are leaking out information about transactions of the Employees Provident Fund (EPF) of which the media has been very critical.
"They had added that the EPF wanted to do a lot more in the market, provided brokers do not share information with the media," sources who were present at the meeting told Ceylon FT.
Sources said that CB officials were of the view that the media should pick out what they should be reporting, such as the entry of foreign exchange to the tune of Rs 22 billion for the period 1 January 2013 to 30 September 2013, but leave out reporting transactions as to where the explicit details are published. Officials said that they could barely do a transaction without the media reporting it.
One broker, speaking on condition of anonymity, said: "I cannot understand why they want to call all the brokers for a meeting. If a broker is providing confidential information to the public it (EPF) should not deal with that broker. Or for that matter they (EPF) can report the broker to the regulatory bodies."
A broker who was present at the meeting said that the EPF should deal with brokers who provide good investment ideas which should ideally be out-of-the-box ideas.
Further expressing some thoughts, he said that one cannot stop the media writing the good, bad and the ugly.
"The EPF invests public money. The media was always closely watching what they are doing, which should be understood in the right spirit. The media has been quite critical about certain investments made by EPF. The biggest funds in the world evaluate their brokers. They do not deal with everybody. I think EPF should apply the same."
Central Bank officials were not immediately available for comment.