SLIC mulls 5% Public Listing on CSE

The Government is exploring the possibility of listing State-Owned Enterprises (SOEs) on the Colombo Stock Exchange (CSE), government sources told Sunday Observer Business last week.

They said that several SOEs have already communicated their willingness to list with the Finance Ministry.

“Sri Lanka Insurance Corporation Life and General units (SLIC) have already requested to list at least 5% on the main board of the CSE,” they added.

SLIC aims to broaden its ownership base to improve transparency and governance through an independent board structure. The company is also seeking a true valuation of its business through the potential listing process, sources said.

However, they emphasised that no final Government policy decision on listing SOEs has yet been made. The matter is being considered broadly, pending the passage of the State-Owned Commercial Enterprises Management Bill and the setting up of the related holding company.

The Government has already taken measures to enhance profitability and efficiency in SOEs through effective governance, structured management, and cost-reflective pricing policies.

In anticipation of potential SOE listings, the Securities and Exchange Commission of Sri Lanka (SEC) and the Colombo Stock Exchange (CSE) have been actively explaining how SOEs could utilise the capital market to diversify funding sources, strengthen financial infrastructure, and improve the quality of services provided. Rather than pursuing privatisation, the SEC views this SOE listing process as a means of ‘equitisation’ — broadening ownership, improving transparency and governance, and introducing much-needed liquidity into the market.

The SEC and CSE recently jointly hosted a forum themed “Defining the Future of State-Owned Enterprises through Capital Market Integration” for a gathering of SOEs in Colombo. According to the CSE, the Forum, initiated with the support of Secretary to the Treasury, Dr. Harshana Suriyapperuma, is part of a broader initiative to engage and encourage SOEs to use the capital market as a source of funding to catalyse mid to long-term business and organisational growth.

Over 45 SOEs had the opportunity to engage with senior Government officials, veterans from SOEs, and capital market experts to discuss capital-raising pathways through the CSE, a CSE official said. During the event, SEC Chairman Snr. Prof. D. B. P. H. Dissabandara underlined capital markets as a tool to address financial constraints, governance gaps, and reliance on Treasury funding.

The SEC is also considering introducing Municipal bonds and infrastructure bonds to the CSE to fund feasible Government and local government projects, depending on the financial viability of Local Government bodies and the respective infrastructure projects, without burdening the Treasury or local taxpayers.

The previous Government had decided to list 20% of the State-owned Bank of Ceylon and People’s Bank on the CSE and start amending related banking laws. At that time, the CSE set up the Catalyst Board with less stringent entry requirements to facilitate gradual SOE market integration.

According to the CSE, there were 25 listings on the Exchange last year, including six newly listed companies, to raise capital for rapid expansion, as well as the issuance of new instruments for the first time in the country, including Blue Bonds, Green Bonds, Social Bonds, High-Yield Sustainable Bonds, and Shariah-Compliant Debt Securities.

Source - Sunday Observer