The Colombo Stock Exchange (CSE) has enabled local entities incorporated or established in Sri Lanka to issue and list foreign currency-denominated shares in the main market segment (Diri Savi and Main Boards) of the CSE.
CSE Chairman Dumith Fernando, welcoming the move, stated: “The enabling of the raising of foreign capital would fulfil a gap for capital raising in the Sri Lankan capital market. This was formulated taking into consideration the interests expressed by several local entities in raising foreign currency-denominated capital via the CSE. We hope that Sri Lankan companies aspiring to grow internationally can now make use of this unique opportunity via the CSE to meet their foreign currency growth capital needs.”
This new financing option for local companies is a result of the new strategic plan the CSE launched in 2020. Having obtained necessary clearances from the Securities and Exchange Commission of Sri Lanka (SEC), the Listing Rules and the Trading Rules of the CSE and the CDS Rules of the Central Depository Systems (Pvt.) Ltd. have been suitably amended to facilitate the listing, trading, and clearing and settlement of foreign currency-denominated shares to be issued by local entities. The aforementioned regulatory framework has been effective since 14 February 2022.
Speaking on the development, CSE Chief Regulatory Officer Renuke Wijayawardhane commented: “The CSE submitted a comprehensive business proposal, including the proposed regulatory policy framework governing the listing and trading of foreign currency-denominated shares issued by local entities on the CSE to the Central Bank of Sri Lanka (CBSL) and the Ministry of Finance via the SEC, and the CSE continuously engaged with the Department of Foreign Exchange of the CBSL in formulating the regulatory framework for this mechanism, resulting in a comprehensive set of regulations and directions being issued by the Ministry of Finance, which facilitate and enable the listing and trading of foreign currency-denominated shares and debt securities on the CSE by local entities. With this initiative, we also hope to create a new stream of foreign currency-based revenue for market participants.”
The CSE is a company that is limited by guarantee and established under the laws of Sri Lanka. The CSE is licensed by the SEC and is a mutual exchange consisting of 15 members and 13 trading members. All members and trading members are licensed by the SEC to operate as stockbrokers.
Local corporates to raise foreign currency-denominated capital through CSE
21 Feb 2022
Local corporates to raise foreign currency-denominated capital through CSE
21 Feb 2022
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