Colombo (LNW): The Sri Lankan Rupee once again indicates depreciation against the US Dollar as revealed by the exchange rates issued by several leading commercial banks today (26). The depreciation comes in in comparison to the week earlier.
Accordingly, People’s Bank reveals the buying price of the US Dollar has surged to Rs. 299.74 from Rs. 298.77, and the selling price to Rs. 317.47 from Rs. 316.44.
Commercial Bank reveals the buying and selling prices of the US Dollar remain unchanged at Rs. 297.68 and Rs. 316, respectively.
At Sampath Bank, the buying price of the US Dollar has increased to Rs. 300 from Rs. 298 and the selling price to Rs. 315 from Rs. 313.
Colombo (LNW): The Colombo Stock Exchange (CSE) has declared June 30 as a special holiday, subsequent to the government’s declaration of the same date as a special bank holiday.
A long-bank holiday ought to be obtained for the finalisation of the domestic debt optimisation, hence the declaration of June 30 as a special bank holiday, according to CBSL Governor Nandalal Weerasinghe.
PMD: The Government is paying close attention to certain parties’ attempts to satisfy their political needs by giving the ‘Aswasuma’ program, which was created to aid those in need of economic stability, a political façade.
However, the Government assures that any shortcomings in the process of selecting the relevant candidates will be rectified immediately and plans are being made to discuss this with the district secretaries, divisional secretaries, and other parties involved in the program in the coming week.
Accordingly, these payments will be distributed among four social categories, namely transitional, vulnerable, poor, and extremely poor. Additionally, the usual allowances for the differently-abled, elderly, and kidney patients will also be provided.
6728 officers were employed in the data collection process for the information survey of the program to identify those who are eligible for welfare benefit payments, covering all the divisional secretariats across the island. It included 3190 development officers, 494 economic development officers, 205 Grama Niladhari officers, 1127 other officers and 1712 temporary recruits.
At the regional office level, a three-member selection committee will monitor the data and, after approval by the district secretary, the deserving candidates will be selected.
Prime Minister Dinesh Gunawardena as the Provincial Councils and Local Government Minister announced this morning (25) that the time period given to those who have been wronged in the selection of the beneficiaries of the ‘Aswesuma’ welfare benefit payment program to hand over appeals and objections has been extended until July 10, as some parties have alleged that there have been shortcomings in the process.
The necessary work is also being carried out in this regard by Acting Finance Minister Shehan Semasinghe and Finance State Minister Ranjith Siyambalapitiya.
Accordingly, if an individual or family in need of economic stability has lost this benefit, there is an opportunity to correct it by making inquiries through the Divisional Secretariats during the relevant period.
The Government emphasizes that the basic requirement of the ‘Aswesuma’ program is to provide the necessary contribution to the people who need economic stability, and not to meet the needs of various parties based on a mere political process.
The Government advises against panicking as a result of yielding to political instigation or external influences if your name is not on the currently published list or if the name of an ineligible individual is on it. Instead, make any pertinent queries through the Divisional Secretariat Offices. The Government further informs the applicants that they can contact the Divisional Secretary for assistance with any issues that may have developed with regard to their applications.
Colombo (LNW): The Samagi Jana Balawegaya (SJB) has won the election for office at the Various Cooperative Society in Mahaoya – Padiyathalawa.
Accordingly, the SJB group has secured 08 out of 11 regions in the Co-Op Society election, and 04 out of 07 members of its Director Board have been elected from the main Opposition party.
Kandy (LNW): DP Education has joined hands with the 2023 Kandy Book Fair, which commences today (26) running up to July 02.
The Kandy Book Fair is being held in Kandy City Centre and you can find the DP Education stall inside.
Visit the stall and you can learn about and connect with DP Education’s free educational opportunities and also win 5 valuable tabs by subscribing to DP Education’s Facebook Page and YouTube Channel.
DP Education invites everyone to visit their stall at the Kandy Book Fair.
Colombo (LNW): Showers or thundershowers will occur at times in Western and Sabaragamuwa provinces and in Kandy, Nuwara-Eliya, Galle and Matara districts, whilst fairly heavy showers above 75mm can be expected at some places in the Western province and in Galle and Matara districts, announced the Department of Meteorology in its daily weather forecast today (26).
Several spells of showers will occur in North-Western province, and showers or thundershowers may occur at a few places in Uva province and in Ampara and Batticaloa districts during the evening or night, the statement added.
Fairly strong winds about (40-45) kmph can be expected at times in western slopes of the central hills, Western and North-Central provinces and in Puttalam, Galle, Hambantota and Trincomalee districts.
General public is kindly requested to take adequate precautions to minimise damages caused by temporary localised strong winds and lightning during thundershower.
Marine Weather:
Condition of Rain:
Showers or thundershowers will occur at several places in the sea areas off the coast extending from Puttalam to Matara via Colombo and Galle.
Winds:
Winds will be south-westerly and speed will be (25-40) kmph. Wind speed may increase up to (50-60) kmph at times in the sea areas off the coast extending from Hambantota to Pottuvil and off the coast extending from Kankasanthurai to Puttalam via Mannar. Wind speed may increase up to 50 kmph at times in the sea areas off the coast extending from Trincomalee to Kankasanthurai and from Puttalam to Hambantota via Colombo and Galle.
State of Sea:
The sea areas off the coast extending from Hambantota to Pottuvil and from Kankasanthurai to Puttalam via Mannar will be rough at times. The sea areas off the coast extending from Trincomalee to Kankasanthurai and from Puttalam to Hambantota via Colombo and Galle will be fairly rough at times. Temporarily strong gusty winds and very rough seas can be expected during thundershowers.
Last night, the CB Governor abruptly announced a bank holiday of 5 days from coming 29th. Accordingly, a special bank holiday was announced for 30th so that 4 actual holidays plus the special holiday become 5 days of bank holiday.
I felt panic whether my deposits at banks could be unsafe. The reason is that, as I am aware from other countries, the authorities declare bank holidays to prevent any anticipated bank runs or panic depositors running to banks to withdraw their deposits unexpectedly.
However, the purpose of the bank holiday declared above was described as the time period required for the completion of the government domestic debt optimization already announced in the media.
The news presented by the CB Governor covered following items.
The government and the Ministry of Finance have decided the time frame to complete the process of domestic debt optimization.
The process is involved in getting approvals from the Cabinet, Finance Committee and Parliament.
For this purpose, banking and financial market stability is required for 5-day period.
However, week-end banking, online banking and ATMs will function as usual.
The CB Governor assured that this debt optimization would not have any impact on bank deposits and deposit interest rates.
My Observations
First, even the meaning of the debt optimization has not been clarified yet although the authorities refer to debt restructuring with regard to govt. foreign debt. Therefore, the need for a bank holiday for domestic debt optimization is unknown.
Second, according to official comments made from time to time, debt optimization also is similar to debt structuring as the government hopes to reduce its domestic debt service burden through the rework of debt contracts on Treasury bills and Treasury bonds. Debt haircut, interest rate reduction, maturity extension and deferment of debt service are general elements of the debt rework.
Third, if the debt optimization is a sort of debt restructuring or rework, it is difficult to understand why a specific bank holiday of 5 days is required for the completion of approval process.
Fourth, once the elements and modalities and legal clearance including any judicial process are determined by the relevant authorities, debt restructuring process is nothing but adjustments of financial statements of investors, i.e., banks, other financial institutions and individual investors, of the date applicable to the debt rework announced by the government.
Accordingly, the adjustment will involve in the value of their assets in government debt/securities, capital if any loss to their assets is realized through the debt rework and income statement of the current quarter and financial year if any loss is to be assumed (by way of reduced interest rates, haircuts, etc.). As such, their liabilities such as deposits and borrowings utilized to fund the investments in government debt in the balance sheet should not be directly affected as at the restructuring date.
Therefore, the debt rework is only an accounting/book-keeping exercise for both the government and investors and, therefore, does not require any specific holiday period for banks or other investor financial institutions such as finance companies, superannuation funds and insurance companies.
Fifth, why same holiday for non-bank financial institutions was not declared is an issue although they also are investors in government securities.
Sixth, the approval process such as Cabinet, Finance Committee and Parliament does not involve in any bookkeeping as highlighted above. Therefore, why a specific bank holiday is required for the completion of this approval process is not established.
Overall Comment
The CB Governor did not clarify why a specific bank holiday was required for the Parliamentary approval process on so called domestic debt optimization.
However, a trigger of a systemic risk of unwanted or undue depositor panic as I myself felt from this breaking news should not be discarded, given the present status of economy’s bankruptcy caused by the debt and foreign currency crisis.
The secret of banking is the depositor trust and not the Central Bank or bank financial statements.
Therefore, the authorities should not paly games with depositors as their readings of risks and herd behaviours cannot be modelled or forecasted in advance while the probability of contagion of a debt and foreign currency crisis across the domestic currency is high as experienced in many countries.
The CB Governor’s assurance that depositors (deposits or interest rates) would not be affected by the proposed debt optimization is technically incorrect because that depends on the financial strength of banks and financial institutions to absorb any financial hit caused by the debt rework on their investments in government securities. In addition, if depositors feel unsafe of their deposits consequent to the debt rework, any depositor turmoil could cause losses to uninsured deposits unless the government pay them back. Nobody can exactly predict such instances.
(This article is released in the interest of participating in the professional dialogue to find out solutions to present economic crisis confronted by the general public consequent to the global Corona pandemic, subsequent economic disruptions and shocks both local and global and policy failures.)
P Samarasiri
Former Deputy Governor, Central Bank of Sri Lanka
(Former Director of Bank Supervision, Assistant Governor, Secretary to the Monetary Board and Compliance Officer of the Central Bank, Former Chairman of the Sri Lanka Accounting and Auditing Standards Board and Credit Information Bureau, Former Chairman and Vice Chairman of the Institute of Bankers of Sri Lanka, Former Member of the Securities and Exchange Commission and Insurance Regulatory Commission and the Author of 10 Economics and Banking Books and a large number of articles published.
The author holds BA Hons in Economics from University of Colombo, MA in Economics from University of Kansas, USA, and international training exposures in economic management and financial system regulation)
Govt declares Friday, June 30, a special bank holiday, leading to a 5-day bank holiday from June 29 to July 3: analysts say the govt wants a long weekend to provide a buffer for the potential adverse market reaction to the worrisome Domestic Debt Re-structuring announcement: CB Governor Nandalal Weerasinghe who had continuously insisted that domestic debt will not be re-structured, now says the safety of local deposits will be assured and interest will not be affected.
Parliamentary Affairs Committee meeting scheduled for Tuesday to seek approval for the restructuring of domestic debt proposal: SJB MP Harsha Silva who was strongly advocating an IMF programme which has led to debt re-structuring, now says he is opposed to domestic debt re-structuring.
SJB Activist & Investment Advisor Niroshan Padukka reiterates that a massive scam occurred via the Treasury Bill issues totalling Rs.200 billion by the Central Bank on 31st May 2023 and 2nd June 2023: insists that the T-Bill Issues were made at interest rates of around 25% per annum when the secondary market rates of such T-Bills were around 16%: says the loss suffered by the Govt is around a staggering Rs.25 billion: also says a complaint in this regard will be lodged with the Bribery & Corruption Commission today.
Chief Govt Whip orders all ruling party MP to remain in Colombo this week: overseas travel specifically cancelled: order reportedly made since the debt re-structuring proposal is scheduled to be tabled in Parliament for adoption this week: analysts and stakeholders fear the worst, considering the anxiety of the ruling party in relation to the debt re-structuring.
Immigration Dept says 911,689 passports have been issued in 2022, the highest number in the last 5 years and 529,138 more than in 2021.
Airline Pilots’ Guild says the cadre of Pilots at SriLankan Airlines which should be 330 is only 250 as a result of shortsighted, arbitrary and callous decisions of the management: points out that SriLankan Airlines pays wages which are well below industry standards, to its Pilots.
Airport & Aviation Services Chairman G A Chandrasiri says 19 potential investors and strategic entrepreneurs have participated in the bidding process for Public-Private Partnership investment opportunities at Mattala Rajapaksa Int’l Airport.
Senior Consultant Physician Dr Ananda Wijewickrama says 75% of the reported dengue cases involve people older than 15 years: asserts over 47,000 cases have been reported since January: points out that the majority of the patients recorded so far are from the Colombo and Gampaha districts.
Sri Lanka defeats Ireland in the ICC Cricket World Cup Qualifier 2023 by 133 runs: Sri Lanka – 325 (49.5): Dimuth Karunaratne 103, Sadeera Samarawickrama 82, Dhananjaya De Silva 42*, Charith Asalanka 38; Ireland – 192 (31): Wanindu Hasaranga – 79/5: Hasaranga has now taken 5 wickets or more in 3 consecutive ODIs, a feat hitherto carried out by the great Pakistani fast bowler Waqar Younis, 33 years ago.
Sri Lanka, Scotland, Oman, Zimbabwe, Netherlands and West Indies qualify for the Super 6 stage of the ICC Cricket World Cup Qualifier Tournament.
Today, the 26th of June, my father will turn 86. He’s not in the best of health and is in no condition to celebrate. My mother, brothers and perhaps some close relatives and friends will be there to wish him. I will be a few hours late. By the time I reach home from the airport he is likely to be asleep. That kills me because my father would always be a few hours early for my birthday and those of my brothers.
Eric Cooray, my father, was always surrounded by lots of people as a young man, but all that changed when he married my mother. From that day onwards he was absolutely devoted to her and later to us as well.
I can’t remember my baby days, but I vividly remember my first days at St Thomas’ College, Mt Lavinia. I insisted that I sit close to a window. He was strictly instructed to locate himself so that I could see him. He didn’t need to be told. I was extremely attached to him and he loved all of us very much, as I realised much later, for it was a pattern — he never let us down. He put up with all our nonsensical demands and quite happily too. Nothing has impressed me more than the fact that he has always been a family man, first to his wife, then to his sons and now to his daughters-in-law and grandchildren.
A few weeks ago, when he was in hospital, there were times I fell asleep out of exhaustion. I always woke up feeling guilty because I remembered how he stayed up by our beds when we fell sick, checking on us throughout the night. Then I understood and appreciated all over again the fact that he has always been my hero. He has set the standards that I aspire to achieve and maintain.
My father, who hails from Paiyagala, was an extremely hard working man who lived a very tough life but faced all challenges with utmost calm and exemplary courage, never once compromising his principles.
A strong Catholic, he firmly believed that God gave us two ears and one mouth for a reason. He spoke little and didn’t care much for those who overdramatised matters. Neither did he speak ill will of anyone. He may have had reservations about people, but he kept those to himself. It was clear however that he appreciated loyalty and honesty. Indeed, he taught us the virtues of both qualities, simply by affirming them in his life.
He worked hard and appreciated deeds more than words. He bore his crosses quietly, grieved in private. He knew who he was and what he was capable of. He never pretended to be someone he was not. He was proud of what he had accomplished but was not one to brag about it. His grit, discipline and faith saw him through the tough times, but he didn’t make a song and dance about it.
Family, as I said, was everything to him. He wanted to see his sons grow into strong men and responsible citizens and did everything to make this possible but didn’t let any of it detract from his love and loyalty to his wife, our mother.
Today, as I, now a father, struggle to do everything to make it possible for my daughters to grow into strong, intelligent, compassionate, and responsible young women, I find myself drawing extensively from my father’s life, thinking and ways of parenting. He has taught me even though he hardly ever lectured me about such things. I too want to be the bedrock of my family as he was the bedrock of his. I strive to cultivate his indomitable spirit and often wonder if I can ever emulate him.
It doesn’t matter, though. Whenever I have to make an important or difficult decision, I simply ask myself ‘what would Thattha have done?’ Invariably I remember many instances where he did things in a certain way and I get the answer I was looking for.
I don’t know if I ever lived up to his expectations, but then again he never insisted that any of us should be anything other than what we wanted to be. He was distant that way. Correctly so, I might add. He’s close in so many other ways; so close and such a giant too that he makes me feel very small, and so well protected by him even though he’s in his eighties and I am in my fifties.
