CSE open today despite Fort curfew

The Colombo Stock Exchange (CSE) will be open for trading today (26) despite the imposition of curfew in Fort, where it is situated, and other parts of Colombo, unlike the previous Covid-19-imposed curfew period earlier this year.

CSE Chairman Dumith Fernando

CSE Chairman Dumith Fernando confirmed this to The Morning Business last (25) evening.
“Yes, we plan to stay open for trading. We have run the proper preparatory exercises and are ready to operate remotely,” he said.

This would be a welcome change for investors and stockbrokers from the first Covid-19 lockdown/curfew period in Sri Lanka when the market was kept closed for a staggering seven weeks.

The continued operation of the CSE has been made possible due to its recent digitalisation initiative, which was completed on 17 September, with the conversion of paper-based statements to electronic forms to facilitate companies listed on the CSE to pay dividends electronically to shareholders. Furthermore, the CSE launched a new CSE mobile app for end-to-end digital onboarding and online account opening that removes the barriers to entry for new investors, enabling any eligible prospective investor around the country to open a Central Depository Systems (CDS) account to trade in the market without the need to visit a branch office.
The digitalisation also featured the revamp of the CSE and the Securities and Exchange Commission (SEC) digital touchpoints, including the new CSE, SEC, and CDS websites that were relaunched with “user-friendly” interfaces to offer users an informative browsing experience covering trading information, regulatory information, as well as investor-centric information maintained by the CDS.

With the new online account opening feature offered by the CSE mobile app, prospective investors can begin investing instantly with their account opening, trading, and settlements, and monitor their accounts remotely.
The CSE was kept closed from 20 March to 10 May mainly due to the inability of being physically present at the CSE to undertake usual operations as well as due to restricted mobility, according to the CSE. According to the SEC, the payment settlement was rendered impossible during the previous occasion, which necessitated the market closure, but digitalisation has addressed this issue. The digitalised platform requires CDS account holders to provide their bank details to make sure that settlement would be done even during a curfew as long as the banking sector remains active. Even during the previous lockdown, most banks remained open as they were deemed essential services.

The seven-week market closure created uncertainties amongst the investors, particularly among foreign investors who were unhappy that they were being prevented from pulling out their investments in a volatile market situation. This, along with other macroeconomic conditions and a bleak outlook, has resulted in a huge outflow of foreign funds from the CSE since its reopening; a trend that has continued even up to the last week.