The Central Bank of Sri Lanka today decided to suspend Perpetual Treasuries Limited from carrying out business and other activities as a Primary Dealer for a period of six months.
The Central Bank however assured that it will take necessary measured to ensure that the suspension will not have a disruptive impact on the market.
In a statement issued today, the Central Bank said, “The Monetary Board of the Central Bank of Sri Lanka on July 06, acting in terms of the Regulations made under the Registered Stocks and Securities Ordinance and the Local Treasury Bills Ordinance, has decided to suspend Perpetual Treasuries Limited (PTL) from carrying on the business and activities of a Primary Dealer for a period of six months with effect from 4.30 p.m. on July 06, 2017.”
Perpetual Treasuries which has been accused of having a direct link to the Central Bank Treasury Bond scam during ex-Governor Arjuna Mahendran’s term, recorded a profit of Rs. 5.1 billion for the year ending March 2016, which was 430 percent increase in profits in comparison to the previous year.
In February, incumbent Governor of the Central Bank Dr. Indrajit Coomaraswamy instructed Inspector General of Police Pujith Jayasundera to conduct an investigation into Perpetual Treasuries. However, despite the directive, sources said that the police has been soft peddling the probe, because it is a well-known fact that Perpetual Treasuries is directly linked to Mahendran and his son-in-law Arjun Aloysius, who are closely associated to Prime Minister Ranil Wickremesinghe.
During, Mahendran’s tenure as Governor of Central Bank, Perpetual Treasuries made the news rounds after being allegedly involved in a Treasury bond scam. Reports claimed that Perpetual Treasuries was issued, directly and indirectly, with Rs. 5 billion worth in bonds at 12.5%. The COPE report released last year also recommended that a law enforcement agency must carry out an investigation into Perpetual Treasuries Limited and how it received undue advantage as a primary dealer from the Central Bank.