SEC urges stockbrokers to expand beyond Colombo
View(s):The Securities and Exchange Commission (SEC) is reconsidering renewing stockbroker licences of broker firms which do not have branches outside of Colombo, officials said.
The licence is renewed every three years. Out of the 25 stock brokers, only a handful has branches outside Colombo.
The SEC, together with the market operator, the Colombo Stock Exchange (CSE), is pushing for wider participation in retailers in the market. This announcement by the regulator came to the stockbrokers early this year, at a Progress Meeting, a stockbroker said, noting that this was announced in a bid to encourage broking houses to spread their branches to capture more retailers. The CSE, in collaboration with the SEC, conducts forums and workshops across the country to engage with investors and provide information on market growth opportunities to broaden the retailer base.
These efforts include local awareness campaigns, digital platforms for information dissemination, and the development of new financial products like Exchange Traded Funds (ETFs) to attract and inform individual investors about the opportunities in the Sri Lankan market.
The CSE is speeding up its digital transformation by improving its web trading systems and mobile applications. “These upgrades offer investors real-time news and investment updates, making market access more convenient than ever. These efforts also need reciprocation by the stockbroking houses,” an official said, noting that they are expected to increase their branch network at least by next year.
The capital market has shown robust performance in recent years, embodied by significant growth in index returns, market turnover, and capital raising activities. In 2023, the All-Share Price Index (ASPI) and S&P SL20 achieved impressive returns of 25.50 per cent and 16.42 per cent, respectively. This upward trend continued into 2024, with returns rising to 49.66 per cent for ASPI and 58.46 per cent for S&P SL20. The momentum has continued into 2025, marked by bigger market turnover and sustained interest from foreign investors.
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