Sri Lanka gilt primary dealers asked to trade on Bloomberg terminals

ECONOMYNEXT – Primary dealers in Sri Lanka’s over-the-counter market for government securities have been asked to trade and report deals on Bloomberg, a firm that provides trading terminals and financial information.

Sri Lanka’s central bank said all primary dealers have been asked to trade among themselves on Bloomberg and report deals with clients within 30 minutes if the deals are bigger than Rs50 million. In general, Rs50 million  is the minimum deal size in the Colombo market.

"The Central Bank plans to release such information twice a day, at noon and at the close of day, in due course when the reporting system is fully operative," the central bank said.

"This information will help investors to study the current status of government securities market conditions along with other financial market and economic information and make more informed decisions in relation to their investments."

"The availability of such market information will further promote transparency, price discovery and outreach of the government securities market in parallel to other financial markets."

"In due course, outright secondary market sales of government securities by non-primary dealer banks to their customers will also be brought into this system."

The central bank said it was in the process of buying a separate trading platform to trade gilts, and it will also set up a central counter party to trim settlement risks.

At the moment, risk-averse banks, especially foreign banks, have restrictions when trading with smaller firms.

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