The Colombo Stock Exchange (CSE) adopted progressive changes to the CSE’s listing framework for new listings, offering a wider choice of listing options for companies wanting to list shares on the Main and Diri Savi Boards.

This action has been taken by taking into account the role played by capital markets in the growth of the corporate sector and the importance of offering multiple avenues through which companies aspiring for growth can access capital markets,

An analysis of recent listings on the CSE indicates that these amendments in particular have paved the way for two companies to list on the CSE and access capital market-based funding valued at Rs. 4.7 billion.

Both IPOs were oversubscribed on the opening day and by 16+ times collectively drawing considerable investor interest at the time.

Interestingly, the listing framework prior to the amendments made by the CSE may not have attracted these two corporates – indicating that the amendments have been successful in making a stock market listing a possibility for a broader array of aspiring issuers.

These recent issuers representing two different industries have benefited from the CSE’s initiative in broad basing the profit-oriented eligibility requirement applicable to the Main Board.

Prior to the amendments, the CSE Listing Rules required that all companies aiming to list on the Main Board demonstrate net profit after tax for three consecutive financial years. Three alternatives to this requirement were introduced by the CSE as part of the amendments.

The CSE’s Main Board listing criteria now accepts companies that can demonstrate an aggregate net profit after tax for three consecutive financial years, meaning that companies aiming to list on the exchange are no longer required to be profitable in each of the three financial years immediately preceding the date of the initial listing application.

Further, companies that cannot meet the profit-based criteria for the Main Board can demonstrate eligibility through revenue or positive operating cashflow (one of either), if the company’s market capitalization is valued at Rs. 5 billion or above at the point of listing.

The revenue-based option would require the company to demonstrate an aggregate revenue of Rs. 3 billion for three financial years immediately preceding the date of the initial listing application.

Alternatively, the positive operating cash flow option would require the company to demonstrate positive operating cash flows (after adjustment for working capital) for two consecutive financial years immediately preceding the date of the initial listing application.

Commenting on the development, Chief Regulatory Officer at the CSE Renuke Wijayawardhane stated that the amendments to CSE Listing Rules were put in place to broaden the rules to complement Sri Lanka’s rapidly developing commercial landscape comprising multiple new business models and segments.

If the company’s market capitalization is valued at Rs. 2 billion or above at the point of listing, demonstrating revenue of Rs. 350 million for the financial year immediately preceding the date of the initial listing application will be an acceptable alternative to the Positive Net Assets requirement.

CSE CEO Rajeeva Bandaranaike called on Sri Lankan corporates interested in listing to actively engage the exchange and the investment banking community to understand the wide-ranging choice of listing options available.

After an alert from the Union government on the scheduled arrival of Yuan Wang 5, a Chinese research vessel at Sri Lanka’s Hambantota port on August 11, the Tamil Nadu police have decided to scale up security at vital installations along the coastline.

The vessel is involved in space and satellite tracking and intercontinental ballistic missile launches, the Hindu reported.

Col. Nalin Herath, media spokesperson of Sri Lanka’s Defence Ministry, had earlier confirmed the vessel will be in Hambantota from August 11 to 17, “mainly for replenishment, including of fuel”.

The alert was issued to Tamil Nadu since there are many vital installations such as sea ports and nuclear power reactors along its 1,076-km coast.

The State has already enhanced its surveillance in coastal districts in view of the ongoing political crisis and worsening economic crisis in Sri Lanka.

The economic crisis has resulted in illegal entry of fleeing Tamils. There were also intelligence inputs that some extremist elements could sneak into the country.

“The organisations supporting the cause of the Liberation Tigers of Tamil Eelam (LTTE) and Tamil chauvinist outfits could stage protests against Sri Lanka for allowing China’s military presence in its territory since it would be against India’s defence interests,” a senior police officer said.

The Superintendents of Police of the coastal districts were told to deploy enough manpower at all sensitive establishments and intensify checks on roads leading to the coastal areas.

On Tuesday, senior Indian diplomats working in Indian missions abroad met Tamil Nadu Director-General of Police C. Sylendra Babu and Sandeep Mittal, ADGP, Coastal Security Group, at the State police headquarters in Chennai.

Senior officials described the meeting as “routine”, where the foreign service officers were briefed about the functioning of the Tamil Nadu police and maritime challenges

Sri Lanka’s exporters and foreign currency market players have expressed their dismay on the Central Bank’s decision to crack down on those who violate regulations on foreign exchange transactions, including repatriation requirements of export proceeds, conversions, and mandatory sales to the CBSL etc.

The Central Bank vowed to take stern action within the provisions of all applicable laws against any instances of non-compliance with all regulations on foreign exchange transactions strictly monitoring such practices.

Sri Lanka’s top export chamber has urged the Central Bank (CB) to present facts and figures to support the latter’s argument that exporters are not remitting export proceeds to Sri Lanka.

The National Chamber of Exporters (NCE) said that the CB should monitor repatriation and conversion of export proceeds to the country with the support of a robust system and to penalise those who do not conform to such formalities.

The NCE mentioned that exporters have registered export invoices with the CB through the Customs CUSDEC. As per ruling by the CB, exporters have to remit the full export proceedings to Sri Lanka within 180 days, resulting in a penalty if the stipulated days have been exceeded.

However, if such delays were due to genuine reasons of not accepting goods on time, the CB has recalled the penalties imposed.

Yet, the CB should have a mechanism to check the time difference between filing the custom declaration and remittance of export proceeds, making a note that exporters are permitted to 180 days’ credit.

In a practical world, export proceedings of the previous month will be effected anytime between 01 to 25 weeks, the NCE claimed.

The Chamber requested the CB to provide source verification of figures provided, noting that when Sri Lanka Customs reflects export figures each month, it should be matched against the approved credit period for repatriation of export proceeds.

The NCE said that simply highlighting long years of malpractice by exporters of not remitting forex earnings, is only showcasing the ineffective governance of this highest state authority. “

The Exporters’ Association of Sri Lanka (EASL) welcomes the measures taken by the CBSL, as outlined in their communication of 29thJuly titled “Importance of Fair Play by all Stakeholders of the Economy in countering the current unprecedented economic crisis”.

The EASL is committed to ensuring that its members abide by the requirements of the law in respect of the repatriation of export proceeds and the surrender of residual earnings.

The Joint Apparel Association Forum said it welcomes measures taken by the Central Bank in monitoring foreign exchange transactions and outflows.

Sri Lanka private sector borrowing had declined for the first time in two years in June signalling the waning appetite amidst high rates of interest, economic crisis and business uncertainty.

the growth of credit to the private sector, once adjusted for the impact of the depreciation of the Sri Lanka rupee against the US dollar, recorded signs of slowing in June 2022, year-on-year, while the expansion of broad money has been weighed down by the contraction in net foreign assets of the banking system, Central Bank revealed.

The elevated lending interest rates are expected to slow the expansion of money and credit aggregates in the period ahead, while the high deposit interest rates are expected to draw a significant amount of money in circulation into the banking system

As per latest data of the Central Bank (CBSL), outstanding credit extended to the private sector declined by Rs. 40.6 billion in June to Rs. 7.714 trillion from Rs. 7.754 trillion in May.

Analysts said this is the first dip since May 2020 at the height of COVID-pandemic. In May 2020 credit extended to the private sector decreased by Rs. 69.6 billion to Rs. 5.888 trillion and the dip continued till July to Rs. 5.830 trillion before rebounding in August 2020 to Rs. 5.9 trillion.

Weekly AWPR for the week ending 29 July 2022 increased by 141 bps to 24.94% compared to the previous week according to CBSL whilst a year ago it was 5.76%.

The dip in June comes after the previous month saw just a Rs. 2 billion increase over April.

Post sharp devaluation of the Rupee in March and re-pricing of US Dollar loans, the credit outstanding to the private sector soared to Rs. 7.530 trillion from Rs. 7 trillion in February.

Despite the dip in private sector borrowing, the net credit to the Government from the banking system increased by Rs. 178.2 billion to Rs. 6.677 trillion in June 2022. Outstanding credit to public corporations declined by Rs. 21 billion to Rs. 1.730 trillion in June 2022.

Broad money (M2b) expanded by 17.1% on a year-on-year basis, in June 2022.

The reserve money decreased compared to the previous week mainly due to decrease in the deposits held by the commercial banks with the Central Bank and decrease in the currency in circulation.

The total outstanding market liquidity was a deficit of Rs. 595.388 billion by the end of this week, compared to a deficit of Rs. 591.748 billion by the end of last week, according to the CBSL.

China is a “very important” creditor of Sri Lanka and it would likely be in the interest of both countries if China participated in Sri Lanka’s debt restructuring process, U.S. Treasury Secretary Janet Yellen said recently.

Yellen said she would urge other members of the Group of 20 major economies to put pressure on China to be more cooperative in long-stalled efforts to restructure the debts of countries in debt distress, including Sri Lanka.

Sri Lanka owes at least $5 billion to China although some estimates put it at almost twice that amount.

India has also lent it $3.8 billion and Japan is owed at least $3.5 billion, according to the International Monetary Fund, with another $1 billion due to other rich countries.

“Sri Lanka is clearly unable to repay that debt, and it’s my hope that China will be willing to work with Sri Lanka to restructure the debt,” Yellen told a news conference on the sidelines of a meeting of G20 finance officials on the Indonesian island of Bali.

Sri Lanka defaulted on its $51 billion of international debt in May after years of heavy borrowing and tax cuts by the government, plus the damaging impact of the COVID-19 pandemic

Yellen singled out China for failing to cooperate in efforts to provide debt relief under the Common Framework adopted by G20 members and the Paris Club of official creditors in October 2020 to help heavily indebted low-income countries weather the COVID-19 pandemic.

Three countries – Zambia, Ethiopia and Chad – have applied for help under the framework, but those efforts have stalled, largely due to foot-dragging by China, now the world’s largest sovereign creditor, and private sector creditors.

“More needs to be done to help the most vulnerable, and this is a key message from the US at these G20 meetings,” Yellen told reporters, citing the deteriorating global economic conditions that have pushed many developing countries into graver economic straits since Russia’s invasion of Ukraine.

“A key objective of this trip is to push G20 creditors, including China, to finalize debt restructurings for developing countries now facing debt distress,” she said.

Yellen told reporters earlier this week that it was “quite frustrating” that China was not stepping up on the debt issues, and said Chinese leaders need to better coordinate among various Chinese lenders to developing economies.

Washington would also provide a grant of $70 million to the International Monetary Fund’s Poverty Reduction and Growth Trust to further enable the IMF to continue making zero-interest loans to the world’s poorest economies, Yellen said

Italy has decided to grant an emergency contribution to Sri Lanka worth 300,000 euro with a view to improving food security, the Embassy of Italy in Colombo said.

“The contribution will be channeled through the World Food Program (WFP) and will consist in the provision of food assistance as well as in targeted cash transfers and the distribution of vouchers to the most vulnerable,” the embassy said in a statement.

It also stated;At a time when domestic and international factors are driving food prices higher and higher, thus increasing food insecurity for many households, Italian government believes that it is of paramount importance for the international community to step up its efforts and show its unwavering support to the Sri Lankan people.

This emergency aid measure comes within the framework of the traditional strong partnership between Italy and Sri Lanka and follows another 350.000 euro in-kind contribution granted last April for the purchase of medicines and medical equipment.

It was channeled through the Italian Bilateral Emergency Fund at the World Health Organization (WHO), thus allowing Sri Lanka to pay suppliers abroad directly as per planned procurement by Mininistry of Health in line with supply-chain management processes.


Also in the past, Italy has consistently supported Sri Lanka whenever the country was in need, including in the aftermath of the 2004 Tsunami.

In addition to this, Italy has supported initiatives aimed at strengthening the agricultural sector through the “CEI/Institute for International Economic Cooperation” project in the Moneragala area.

The “Small holder productivity enhancement in Sri Lankan agriculture” project is currently under discussion and at providing professional training to young Sri Lankans (through the so called “SPOSA” project for social workers and care takers in the Chilaw area) with a view to make sure that they acquire the skills that are most required for employment overseas