Central Bank Governor Arjuna Mahendran will go on leave until the investigation into the Treasury Bonds issue is concluded, Prime Minister Ranil Wickremesinghe stated in Parliament today.
Arjuna Mahendran
The PM stated this during a special statement he made in the parliament concerning the issue. Following the controversy where Mahendran was accused of interfering with the issuance of Treasury Bonds in a way that would favour his son-in-law in the bidding process, a three member committee was appointed by the Prime Minister to probe into the allegation.
With effect from yesterday, the committee is to convene on a daily basis to investigate into the specifications of the transaction.
Mahendran was accused of blatant abuse of power when the rates of the treasury bonds that opened on February 27 through which a sum of Rs. 1 billion was offered was hiked up. The allegation was that although the rates of the bonds were expected to be in the range of 9.5%, it had been escalated up to 12.5 % under the instructions of Mahendran. Media reports claim his son-in-law was fully aware of this step and as a result, managed to gain a massive profit by bidding at the renewed rates.
Sensible citizen / March 17, 2015
Mahendran should resign after the conclusion of the inquiry regardless of the outcome. The president was not comfortable when his sibling visited his new office to have a peak at it. If the president has this attitude, Mahendran as a key official in the government entertaining a his son in law to profit from a direct order by Mahendran is a clear violation of conflict of Interest and an act of sabotage whether it is intended or not. If he is honourable and he want to undo the damage done he should resign after the inquiry.
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Amarasiri / March 17, 2015
Sensible citizen
“Mahendran should resign after the conclusion of the inquiry regardless of the outcome. “
And, Mahendran should be provided with a Fishing Boat, preferably Confiscated Indian Fishing boats poaching in Sri Lankan Fishing Waters, to catch Sri Lankan fish, in Sri Lankan waters.
This will be a win-win outcome.
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Amarasiri / March 17, 2015
Arjuna Mahendran
“Central Bank Governor Arjuna Mahendran will go on leave until the investigation into the Treasury Bonds issue is concluded, Prime Minister Ranil Wickremesinghe stated in Parliament today.”
Can you Fish?
The Indian Fishermen are stealing our Fish and exporting.
Ranil Wickramasinghe wants the SL Navy to shoot the poor Indian Fishermen, calling it stealing and robbery. You probably know a lot about stealing and robbery, having worked under the Mahinda Rajapaksa Regime.
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backlash / March 17, 2015
Taking leave until the Inquiry is over is the right thing to do in any government that has a right to call itself democratic. This was never done under the Rajapakse regime. There is no need for Mahendran to resign if the Committee does not find him in any wrong doing. Hurling wild charges and concocting non-existent conspiracies is second nature to most irresponsible Sri Lankan politicians.
A careful reading of PM Ranil’s address to the House today clearly shows there are two sides to the story.
Mahendran, however, must watch his language when faced with criticism.
He must learn a lesson in this regard from that exceptional gentleman –
Raguram Rajan, the head of the RBI in India.
Backlash
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Ram / March 17, 2015
Rs 1 Billion at 9% was sought short term, but we ended up with Rs 10 billion at 12.5%, over 30 years, and even more (Rs 21 billion) was available at this usurious rate which might be a record for Sri Lanka. Now Sri Lanka is lumbered with a long term debt which the next generation will still be paying. When politicians attend Central Bank meetings as alleged and Central Bankers kowtow to politicians one has to wonder whether BOTH benefit at the expense of the common man.
The ‘Common Candidate’ is proving to be a disaster. RW has appointed three UNP stalwarts to whitewash the event.
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K.A Sumanasekera / March 17, 2015
Wonder whether this high profile banker mate of our Good Governance PM , got annual leave every two months at HSBC?…
When is the next issue of our Treasury Bonds?…
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Kumar Sandirasegaram / March 17, 2015
The governor must resign or be sacked. Even if he is permitted to stay by this Kangaroo court there is a general perception that he is tainted with the corruption allegation. His son in law should have resign when he was appointed as the governor. If he stays he will only limp on. He simply cannot win now. To be head of a Central Bank you have to be squeaky clean by his failure to declare a conflict of interest he has left the side and himself down. He must be sacked.
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Samantha Bandara / March 18, 2015
This is ridicules This fellow has to be sack on the basis of good governance Definitely that deal is not an arm length transaction as well as not transparent since it was traded above the market rate and between SLCB and SLCB Governors SIL’s Company. No need any investigation
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MNZ / March 18, 2015
His son in law made a killing on this insider deal.
Mahendran resigning or getting sacked is neither here nor there.
The family can now share the loot and live happily ever after!
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Pot Shot / March 18, 2015
The guilty will plead innocence. Due process should have been followed.
He should have notified his 2nd in command and other key decision makers of the bond auction, of his son-in-laws involvement and stayed clear from it. You can look at it anyway you want Mr. Mahendran and Mr. Prime Minister but their is a serious conflict of interest in this transaction. Mr. Prime Minister if you were in the opposition and MR did this you wouldn’t say this is OK. So stand-up with conscience and be responsible in your conduct as you will meet the same fate of MR soon enough. This is not a Royal College affair this is about our country. Please get that right!!!!!!!!!!!!.
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Das / March 18, 2015
People were expecting a clean Govt.for a change.This has come as a disappointment to all.RW must have been careful after being in the opposition for so long and branded as a serial loser.pl.do not think of your selves but please think of the country.I think in the long term it is the JVP that can save the country.Both SLFP and UNP failed miserably.I expected RW to have gained some experience in handling the affairs.Even the interview with the Indian correspondent should have been handled more diplomatically.RW, please remember you did not get this position on your own right.This was an accident which will not be repeated or you will be in opposition again for a long time.
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Jagath Fernando / March 18, 2015
From the day he was appointed atleast half the week he has been overseas.
This arrangement suits him well to wrap up his previous engagements.
Blessing in disguise !!!
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Piyadasa Yalagala / March 18, 2015
PM spend in few hours Parliament today justifying before members of Chamber the topics of CB governor Bond scandal that of word of ‘patient’ that he an appointment of UNP Lawyers’ committee to be probe of corruptions.. Bond issues and graft of nepotism of CB Governor corruption charges, that answer has been intentionally avoided by PM led UNP clique.
Rise of Interest Rate
The crux of matter is that financial media rise on Interest rates of Central Bank. This is what monetary policy CB come to stand still economic growth? ..this is what we have to be worried damage to rise of $70 billion economy our Island.
We are worried about whether to UNP Lawyers committee of incompetence such complex Bond issues to probe badly impact of growth of GDP.
The Bond issues is overrated in the first place by CB governor’s son-in LAW..
It is important to understand that the CB only directly control the overnight borrowing rate for banks…also known as the CB funds rate.
This rate has been targeted between 9% to 12.5% a quarter of a percent late 2009. This we all know would quickly CRASH STOCKS MARKET AND THE BROADER ECONOMY by UNP Ranil.w.. economy policies of Neo-liberalism.
Since our banks have no massive excess reserves for overnight borrowing rate is 12%.The CB ‘s increasing or decreasing of the money supply as measured by adjusted monetary base, is having bad effect of the CB funds rate and GDP growth.
Negative Impact of national Economy of UNP’s Neo-Liberal Policy recently wrongly advice by IMF and WB & ADB thinking tanks and certain Tamil-origin Singaporeans.
PM’s testimony never tell us or never indicated us, that CB is going to keep a tight monetary policy? Misdeeds of PM-UNP policies that unknown economy and monetary policies last two or three months, that QE biggest round of money injection in the CB history.
Sri Lankan Rupee has weaken at least compared to other currencies. This reflection of how bad the other currencies are been avoided by PM testimony in chamber. CB’s the new policy of UNP- PM, is creating new money like crazy. It is unprecedented for country of its size and economy.
CB of SL is also getting set to engaged in massive monetary inflation. With that and weak Sri lanka economy the RUPPE is appearing very weak. We can say Rupee is weak against the US dollar.
Investing in currencies
It is always important to hedge against the any currencies of own –
Sri lank. It doesn’t matter where you live or what the currant environment looks like you have to protect yourself against the potential of a depreciating of Rupee by UNP that fininancil policies in wrong direction.
UNP economic policies has to defend our economy against currency decision from other nations.
The CB has to following policies
1 Stop printing money to artificially support the economy.
2 Stop loan guarantee programs.
3 Reduce mandate to one; maintain inflation below 2.5% .
4 Reduce unemployment less than 5%.
Without this National economic policies CB out of long-term interest rate setting game so that risks in development of economic.
If UNP -Ranil and his team put off these choices today, forever printing more Rupees, which is inflationary or paying higher rates of interest to sell government debt that will erodes Sri Lankan standard of living and limits the possibilities that our future generation will have.
MR ruling alliance left with tough choices in a difficult economic environment since 2009 May.
MR led Govt. start making changes, but UNP- Ranil.W. CBK & MS today makes changes in reverse for the worse misdeeds of economy at the state and national level as well.
The Governor of CB, corrupted of nepotism- Bonds, which that inside trading that newly emerge of scandal of issues of CB bonds, that is reveled the symbol economic catastrophe is in our door step.
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Plato. / March 18, 2015
The former Governor of the Central Bank,Ajith Nivard Cabraal has more skeletons in the cupboard!
N.U.Jayawardena, another Governor during the days of Sir John Kotelawela was also accused of lack of dishonesty.He was, the son of a Rest house Keeper!
But, whatever way you look at it even Caesars wife must be above suspicion!
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Ram / March 20, 2015
” accused of lack of dishonesty “
That is what we DO look for in a Central Bank governor.
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Dr.Goebells / March 19, 2015
Plato
You seem to have used this opportunity to take a cheap shot at a former governor .
However , what does the fact that his father had been a rest house keeper have to do with anything ? Does that mean he was not qualified for the job ?
You have also said ‘he was accused for the lack of dishonesty ‘ . I suggest you brush up on your writing skills before you cast aspersions on others .
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Plato. / March 19, 2015
C.T.
I am sorry.
It should be lack of honesty,and not lack of dishonesty.
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Piyadasa / March 20, 2015
How is accountability of ‘good governances’ by UNP leader Ranil.W..?
CB Governor must be sack by PM.
And PM must undertake responsibility of wrong doing that which cheating Public Tax payers Money?
By and large that CB Governor related graft of Financial scandal.
Cancelled Bond issue by CB as quick as possible.
This shows UNP type of ‘good Governances’, is hipcoracy !
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shankar / March 21, 2015
“Mahendran To Go On Leave”
what category does it fall into?long service leave?
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Das / March 25, 2015
Friend, you got away cos this is Sri Lanka.Had you done this inSingapore,LKY would have put you behind bars.
I wonder how did Ranil allow this?He was branded as a serial loser.why hasn’t he learn a lesson?
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