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Sri Lanka President says suggested Central Bank Governor resign after bond scam

ECONOMYNEXT – Sri Lanka’s President Maithripala Sirisena said he had suggested that Central Bank Governor Arjuna Mahendran resign following 10 billion rupee bond scam that rocked the new administration.

In a February bond auction, 5 billion rupees in 30-year bonds were sold at sharply higher interest rates to a company connected to Central Bank Governor Mahendran’s son-in-law after asking a tender committee to accept bids from the firm which it had already rejected.

"I have a personal opinion and there is an opinion among the people in the country that (Prime Minister) Ranil Wickremesinghe is not a corrupt person, a thief," President Sirisena told reporters Tuesday explaining current political developments.

"In this background… I said the best thing was for the Central Bank Governor to resign."

The bond deal had become the biggest scandal to shatter the claim to ‘good governance’ which the administration was expected to deliver to voters.

Wickremesinghe’s defence of the deal and pointing of fingers of elsewhere has also came a shock to some voters.

President Sirisena appointed the Governor amid concerns over conflicts of interest with Mahendran’s son-in-law’s Perpetual group which has come under fire over sales of stock to the Employees Provident Fund, under the previous administration.

The previous Central Bank Governor’s sister had also been a director of the primary dealer arm.(Colombo/July15/2015)






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