Sri Lanka President’s party asks not to re-appoint CB Governor Mahendran

ECONOMYNEXT – Sri Lanka’s President Maithripala Sirisena had decided to recommend that Central Bank Governor Arjuna Mahendran not be re-appointed after his term ends, amid rising concerns over alleged bond auction rigging and conflicts of interests.

"Our party unanimously decided to recommend to the President not to re-appoint the Central Bank Governor," Minister Sarath Amunugama told a media conference of the United People’s Freedom Alliance coalition Thursday.

"Our stand is that it should not be given. There are several reasons. For one thing, his term ends, so the question of resigning or sacking does not arise."

"So the President now has to make a new appointment. When it is done, it is our party’s view that the current governor Mahendran should not be re-appointed."

"We also think that, whatever the internal reason, where is there is a major suspicion in the country, people should not be in such position."

"We believe the President and Prime Minister will discuss this and amicably solve this problem."

Governor Mahendran is under fire over alleged rigging of bond auctions to favour his son-in-law’s company. There have also been concerns that bonds have been ‘pumped and dumped’ on a pension fund of private sector workers, the Employees Provident Fund, managed by the Central Bank.

Governor Mahendran has denied wrongdoing and defended the actions of the pension fund.

But the governing board of the Central Bank later said in a statement that procedures will be changed both on auctions and investment decisions of the EPF. (Colombo/June17/2016)

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