Boost in CDS Account Opening Due to Digitalisation – CSE CEO
By Rajiesh Seetharam
Twelve thousand two hundred new CDS accounts have been opened through the mobile app after digitalisation of Colombo Stock Exchange (CSE) from September 2020 till end of February 2021, stated CSE Chief Executive Officer (CEO) Rajeeva Bandaranaike. Speaking at a forum organised by Federation of Information Technology Industry Sri Lanka (FITIS) he said, “Since digitalisation, on average 100 CDS are opened per day, which is very positive news. Moreover, 80 per cent of the new comers are below the age of forty. This is huge shift from the traditional investors who are generally above fifty.
With digitalisation, investors can do transactions from any part of the country without going to a stock broker’s office or to a bank. Now, all information is at the finger tips, be it financial statements, Corporate disclosures or broker research analysis.”
Bandaranaike noted that CSE is working on four new products which are to be launched in a medium term period with in a year’s time.
“We are planning on a Gold product system to be introduced to the banks. Currently we are designing the product, talking to regulators for approval from Central Bank, Securities and Exchange Commission of Sri Lanka (SEC).
With the current low interest rates, lot of investment is going into Real Estate. CSE launched Real Estate Investment Trust (REIT) last year, and SEC has gazetted it. Some tax related issues needs to be worked out and has to be gazetted. Once that is done, we see a huge potential where real estate investments would be easily accessible for normal investors.
Third product is an over-the-counter product for repurchase deals on corporate debt. This would add liquidity for corporate debt market. Currently we are working on regulatory approval.
Stock borrowing and lending is the fourth product. It will give an opportunity for both lenders and borrowers as well. Borrowers who cover short position will benefit from it, and other investors can earn some interest in addition to the capital gains”.
CSE CEO further added that primary market is getting activated. “We are completely revamping the listing process to enable a wider range of companies to come in. For example the tech companies where the criteria is not based on profitability but rate on cash flow and revenue.
We saw a 3.2 billion IPO (Wind Force) recently. There are three more IPO’s in the pipeline. Ceylon Electricity Board has come up with a debenture issue. We are seeing activation in primary market, which is good.”