By S.S. Selvanayagam

The Court of Appeal yesterday (20) fixed for support on 3 March to support for notice and Interim Order in respect of the Writ Petition filed by the Perpetual Group of Companies seeking an order quashing the directions of the Monetary Board imposing restriction on it.

The Bench comprised Justices Vijith K. Malalgoda (President/CA) and S. Thurairaja.

When the matter was taken up, Deputy Solicitor General Arjuna Obeysekera appearing for the Attorney General raised objection against supporting the matter for notice and Interim Order. He stated the Attorney General did not receive the notice and the papers.

He also told Court that Deputy Solicitor General Milinda Gunatilake who is now abroad would appear for the Attorney General.

President’s Counsel S.A. Parathalingam appeared for Perpetual and submitted that the Central Bank has acted in prudent in extraneous in violation under law.  He said it is the normal practice to support for notice and if he gets notice, it will establish a prima facie case.

He said he wants to support for notice not for Interim Order.

The Court directed to serve notices on the Respondents by courier service and support on 3 March for notice and Interim Order with notices to the Central Bank, Monetary Board, Central Bank Governor Dr. Indrajit Coomaraswamy and the Director of the Department of Supervision of Non-Bank Financial Institutions.   

The Petitioner company claims that in the absence of any formal violation of procedure by it in the purported bond scandal, the true intentions behind the issuing of the said Directions are mala fide and ultra vires of the regulatory powers of the Respondents.

It bemoans that the impugned Directions are issued for extraneous reasons in order to satisfy the media and political agendas.

It laments that if the said impugned Directions are in force Perpetual Group of Companies would suffer grave and irremediable financial loss and would be driven to bankruptcy.

The Petition was filed by Perpetual Treasuries Ltd., Perpetual Asset Management Ltd. and Perpetual Capital Holdings Ltd., citing the Central Bank, the Monetary Board and 11 others as Respondents.

Instructed by G.G. Arulpragasam, S.A. Parathalingam PC with Nishkan Parathalingam and Niranjan Arulpragasam appeared for Perpetual Treasuries and Nihal Fernando PC with Romali Tudawe and Madura Perera appeared for the other two Petitioner companies.

Some of the Directions are that (1) Perpetual Treasuries Ltd. shall not bid at any primary auctions exceeding 12.5% of the total amount offered at such auction and shall not bid exceeding 20% of the offered amount of each item representing different maturities; (2) the daily aggregate of the secondary market transactions by it in Government securities shall not exceed Rs. 1 billion; (3) It shall not, except with the prior written approval of the Monetary Board distribute its profits, retained earnings or reserves; (4) It shall not enter into any transaction for consideration or otherwise, except with prior written approval of the Monetary Board, in respect of anything not connected with the activities of a primary dealer.

Govt. to receive $1.5b in Samurai Bonds by April 

By Charumini de Silva

The Government hopes to receive $1.5 billion via Japanese Samurai Bonds by April, a top Minister confirmed yesterday.

“This is a first time opportunity that Japanese have come forward to give an underwriting to Yen-denominated bonds equivalent to $1.5 billion. We hope to receive it within the next two months”  Finance Minister Ravi Karunanayake told the Daily FT.

A Samurai bond is a yen-denominated bond issued in Tokyo by non-Japanese companies, and is subject to Japanese regulations. These bonds provide the issuer with an access to Japanese capital, which can be used for local investments or for financing operations outside Japan.

The Minister said that the facility will not necessarily be used to repay debts, adding that it could be used for different purposes on approval.

“It will come into our Balance Sheet and then we can use it on approval for various projects,” the Minister said.

Prime Minister Ranil Wickremesinghe on Sunday speaking at the opening of 20 housing units for the landslide victims of Aranayake said revenue from Samurai bonds and swapping of Hambantota Port debt against an equit stake would help the country to reduce the debt services by end 2017.