A decision taken by Prime Minister Ranil Wickremesinghe to stop a transaction of selling 7% of shares in Seylan Bank that were held by state owned Bank of Ceylon has stirred up the share market in Sri Lanka say stock brokers.
They warn the involvement by the government in share market transactions would discourage investors to the country. On the 16th Rs.1.3 billion worth shares or 7 percent stake in Seylan Bank owned by state-run Bank of Ceylon were sold to a foreign fund at 100 rupees each, a 17.6 percent premium to the stock’s closing price that day, through JB Securities.
However, the Prime Minister ordered a reversal and a probe into the transaction stating it failed to follow proper procedure.
The company that bought the shares was a Japanese company and it is believed that the relevant investment had been done through Singapore. Murtaza Jafferjee, CEO at JB Securities, the stockbroker of the deal, said they were waiting for more clarification on the reversal.