Following latest trends:

Demand for Govt Securities on the increase

HIRAN H. SENEWIRATNE

The demand for Government Securities is increasing among the public due to the low bank savings interest rates and the high credibility factor, said Executive Director Wealth Trust, Mangala Boyagoda.

“The reason for this trend is that Government Securities have the lowest risks and the highest return with zero default from the Government has created this demand,” Boyagoda told Daily News Business.

He said the fall of Sakvithi Investments and Golden Key Credit Card companies in the recent past, have created this latest trend on investing in savings accounts in Banks. Therefore, the demand for Treasury Bills and Treasury Bonds is slowly but steadily increasing among the public, he said.

These investments have high security, liquidity and return on investment factors for investors on Government Securities and the Banks have to play a pivotal role to promote these instruments in the country, he said.

Boyagoda said that investing in Treasury Bills/Bonds are far better than investing in bank savings accounts because the high interest rates and lowest risks have attracted the public.

He said that the banks have much room to promote this concept because most people in other countries are interested in Government Securities to generate funds from the short to medium perspective. The Treasury Bills could raise funds for three months to one-year periods while the Treasury Bonds are between one year to five-year periods.

This is because the Government issues Securities to raise capital from the short to the medium term for major infrastructure projects in the country.