CB Governor is not involved in Treasury Bonds issue

Sunday, 19 April 2015 - 19:53

The three person committee has concluded, following their investigation, that the Central Bank Governor Arjun Mahendran had no direct involvement in the decision making process regarding the Central Bank bonds issue.

A communiqué released by the Ministry of Policy Planning and Economic Affairs stated that the committee report has been handed over by now.

Regarding the auction of treasury bonds which took place on the 27th of February, allegations were raised for presenting the treasury bonds for a higher interest rate for Perpetual Treasuries Company, which has connections to the nephew of the Central Bank Governor.

In addition, there were accusations that the Central Bank has increased the relevant Treasury bond up to Rs. 10 billion.

Later Prime Minister Ranil Wickremesinghe appointed a 3-person committee headed by senior Lawyer Gamini Pitipana to conduct an inquiry regarding the issue.

Following the investigation and recording statements from the relevant factions, the committee issued a 19 paged report which shows that the Central bank’s Public Debt Department has announced the state financial requirement as Rs. 13.55 billion on the 2nd of March.

It also stated that even though the financial logs mentioned regarding the issuance of the 30 year Treasury bond, the amount has not been decided by the financial board presided by the Central Bank Governor.

According to the Policy Planning Ministry, the committee report shows that the Central Bank Governor has not acted as a member of the relevant Tender board.

In addition, the committee also mentions in the report that they did not find any evidence regarding the Central Bank governor having any direct involvement in the activities of the Public Debt Department or the Tender Board.

However, the committee has found malpractices in the Bank of Ceylon regarding the extraordinarily high bid offered in the treasury bond issue.

And they have also shown discrepancies in the manner in which Perpetual Treasuries company offered their bid regarding the treasury bond in question.

Therefore, the 3 person committee has shown the need of further investigations into these matters.

When enquired regarding the matter from the Deputy Minister of Policy Planning and Economic Affairs Doctor Harsha de Silva, he stated that they will take measures to present the committee report to the parliament immediately.

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