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| Tuesday, 2 March 2004 |
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CSE to launch Debt. Securities Trading System on March 3 The Colombo Stock Exchange (CSE) will inaugurate its state-of-the-art Debt Securities Trading System (DEX) on Wednesday, March 3 at the CSE Public Gallery. Former Minister of Finance K. N. Choksy and the Governor of the Central Bank A. S. Jayawardena will inaugurate the DEX. The DEX is an electronic state-of-the-art trading system for the secondary trading in corporate debt securities and in the Beneficial Interest of Government Treasury Bills and Bonds, a press release from the CSE said. The DEX developed by Millennium Information Technologies (MIT) was implemented in June 2003. The CSE has already admitted three specialised debt trading members to use the DEX. Seyland Merchant Bank Ltd, The National Wealth Corporation and Capital Alliance Ltd have been granted licence from the Securities and Exchange Commission of Sri Lanka to operate as Trading Members of the CSE. In addition member firms of the CSE are also eligible to use the DEX. Using the DEX investors would now have the flexibility of purchasing or selling the beneficial interest in Treasury Bills and Bonds and Corporate Debt Instruments. The advantage of using DEX is that trading is scripless and all transactions are carried out electronically and the need for paper is eliminated as much as possible. Settlement risk is minimised in that the securities are delivered only after the settlement bank confirms the availability of funds. It enables real time on line liquidity management and the ability to choose your settlement cycle to suit your needs. It also provided facilities for Repo and Reverse Repo transactions and enables online market information and post trade transaction information. Another advantage is the high level of transparency where bid and ask prices can be viewed by potential investors and the DEX will take the hassle off the investor by collecting the maturity proceeds and coupon interest of investments on behalf of investors. The DEX will also enable investors to buy and sell in lots of Rs. 10,000 which will be particularly beneficial to investors wanting to invest small sums of money. Investors wishing to use DEX would have to transact through a DEX trading member or a regular member of the CSE and open a trading account with the Central Depository System (CDS) of the CSE and place an order with a member firm to either buy or sell the beneficial interest in Government Securities or corporate debentures using one of the settlement options given. The CSE said that this initiative will greatly assist the Central Bank of Sri Lanka to broadbase the Treasury Bill and Bond market in Sri Lanka and enable it to reach investors islandwide, the release said. |
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