Chorus growing for CB Chief’s chop; SLFP joins JVP stand

The Sri Lanka Freedom Party (SLFP) yesterday joined the growing chorus demanding the resignation of Central Bank Governor Arjuna Mahendran to pave the way for a transparent investigation into the controversial Treasury bond issue.
Opposition Leader Nimal Siripala de Silva yesterday at a press conference said that they believed this financial transaction was very dubious, while urging the Government to hold an independent and transparent investigation into the matter.
“If an independent investigation is to be commenced about this issue, then the necessary documents should be brought from the Central Bank, therefore the Central Bank Governor should resign from his position, and if not, then the Government should temporarily suspend his duties to create the path for a transparent investigation. However, after the investigations if the Governor is not found guilty, then he can be reappointed as the Governor of the Central Bank,” de Silva said.

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Commenting further, he also urged Prime Minister Ranil Wickremesinghe to remove Mahendran from the post of Central Bank Governor without dirtying his hands.
“The United National Party (UNP) used to highlight family nepotism. Now we ask them, what is this is then? This is a complete robbery of the people’s money. The Central Bank Governor has no right to stay at a place when bids are going on, but from the information we have received, he had been there when these bids were taking place and that is not correct,” Silva added.
The SLFP’s call comes a day after the JVP demanded the removal of the CB Governor.
JVP Parliamentarian Sunil Handunnetti told the media on Tuesday that appointing a committee to look into this matter was not sufficient and that a formal investigation with transparency was necessary.
“This is not a simple transaction like buying goods from a shop. This could lead to people losing faith in the Central Bank. Therefore the Central Bank Governor should temporarily resign from his post before the investigation is launched, because that it is the only way to ensure transparency, as it is revealed that the company ‘Perpetual Treasuries’ is connected to his son-in-law. Therefore the Governor can resume duties or resign according to the conclusion of the probe,” he said.
Commenting further, Handunnetti said this bond issue appeared questionable or controversial for several reasons and pointed out that the bonds were to be issued at a market rate of 9.5% to raise Rs. 1 billion but it was ultimately issued at 12.5%, raising Rs. 10 billion.
“Bonds are usually awarded to several parties in blocks so as to make the interest rates competitive but in this case bonds worth Rs. 5 billion had been issued to a company owned by the Governor’s son-in-law at an average of 12.3%, resulting in a Rs. 2 billion loss for the Government. Reliability of the financial transactions taking place in Sri Lanka should be maintained while we also urge the Minister of Finance to intervene. If correct, our country’s Finance Minister should resign. But we don’t expect such a thing because we all know that will never happen in our country,” Handunnetti added.