CSE rings 35th year of leading Sri Lanka’s capital market

Bell ringing ceremony

By Darshana Abayasingha

CSE Chairman Dumith Fernando

CSE past Chairman Ajit Jayaratne

SEC Chairman Viraj Dayaratne PC

The Colombo Stock Exchange (CSE) marked its 35th anniversary yesterday, with a special bell ringing ceremony at the bourse. 

The event was titled ‘A Transformative Past – A Vibrant Future’ and CSE Chairman Dumith Fernando said major market infrastructure developments were on the cards with emphasis on product diversification and building a sustainable business model for the bourse as it takes on the next 35 years and more. 

The event was attended by past Chairman of the bourse, Ajit Jayaratne, who reminisced the days when the CSE consisted of just four brokers, before things dramatically changed in 1977. He identified the setup of the Central Depository System as a game changer in the journey of the stock exchange and for its stakeholders.

In 2020, the CSE and the Securities Exchange Commission (SEC) engaged in a transformative project to digitalise all stakeholder touch points in the bourse, enabling end-to-end connectivity, which is vital to broad-base the stock market and provide market accessibility to all Sri Lankans. 

Establishing regulatory readiness to navigate through a Sri Lankan business landscape that has changed substantially since the CSE was first established has been a material focus in 2020. Expanding listing rules to pave the way for a wider spectrum of companies to qualify for a listing and the introduction of Real Estate Investment Trusts (REITs) are other developments that took place this year.

“We must think of greater achievements, even though these are difficult times this can be the best time for unprecedented measures. The Stock Exchange should be the place to raise capital, and to attract more listings we need to do much more. The SEC will extend its fullest support to make the targets a reality. I think we should recognise the initiatives of the Government to develop the capital market. Whilst developing the market, we must maintain the integrity of the market and the SEC will not waiver in this resolve, but it’s a responsibility for all stakeholders,” said SEC Chairman Viraj Dayaratne. 

CSE Chief Executive Officer Rajeeva Bandaranaike said his institution was one of national significance with an unwavering focus and commitment towards creating conditions that support growth. 

“Our stock market has evolved over the years and in the midst of the various growth initiatives we are pursuing, what remains unchanged is our focus on maintaining our market’s integrity and quality. We are fully aware that it is only by operating a fair, orderly and transparent market will investors have the confidence to invest enabling the CSE to expand and broad-base the stock market,” he added. 

The drive to digitalise all stakeholder points of the CSE and infuse modern technology forms the backbone of a developing modern share trading system. Strengthened information and cyber security, together with a revitalised listing framework and platform have made it attractive for companies to come and list.

Given the entrepreneurial spirit of the Sri Lankan people, the Colombo Stock Exchange builds on a share trading tradition that has existed in Sri Lanka for over a century. The business of share trading that commenced with plantation companies in 1896 continues to thrive today as a matured and vibrant stock market that mobilises capital flows of over Rs. 300 billion a year.

The CSE in its present form was incorporated in 1985 and formed by seven stockbroker firms as the Colombo Securities Exchange Guarantee Ltd., a company Limited by Guarantee, marking a transformative shift in Sri Lanka’s financial services landscape. 

The CSE is licensed by the Securities and Exchange Commission of Sri Lanka (SEC) and offers state-of-the art pre-trade, trade and post-trade platforms supported by a network of Stock Broker Firms which offer end-to-end digitalised trading solutions to a diversified pool of over 700,000 individual and institutional investors. A progressive journey with the combined efforts of all stakeholders has paved the way for many decisive and positive outcomes for the Sri Lankan capital market over the past 35 years. 

The CSE has also been an active contributor in the international arena as a member of the World Federation of Exchanges and has on multiple occasions held the Chairmanship of the South Asian Federation of Exchanges, shaping capital market development policy and cooperation in the South Asian region. 

From its inception, the CSE, has been a catalyst in the development of the nation, strengthening and empowering entrepreneurs, corporates and individuals from all strata of the economy. The CSE pursued its strategy to develop capital markets in the country, working together with the market regulator the Securities and Exchange Commission of Sri Lanka to build interest in the market, engaging with market participants to promote the multiple platforms provided for raising capital and investment.