CSE launches Central Counterparty framework for equity trades

CSE Clear Ltd., operates as licenced clearinghouse and CCP guarantees trade settlement, reducing counterparty risk and enhancing market stability CSE Clear Chairman Arjuna Herath says plans to introduce derivatives; licence application already submitted to SEC SEC Chairman Senior Prof. H. Dissabandara notes framework regulated by SEC and aligns with global standards like IOSCO principles CSE Chairman Dimuthu Abeysekera calls it a 'defining moment' in building globally integrated capital market

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THE Colombo Stock Exchange (CSE) on Friday officially launched a Central Counterparty (CCP) framework for equity transactions, significantly enhancing the safety, efficiency, and global appeal of the domestic financial system.

The launch was celebrated with a special market opening ceremony, marking the culmination of years of regulatory and infrastructure reform aimed at modernising the country's post-trade environment and aligning with international standards.

The newly established CSE Clear Ltd., a wholly owned subsidiary of the CSE, will operate as the licenced clearinghouse and serve as the CCP for all equity trades.

The CCP is regulated by the Securities and Exchange Commission of Sri Lanka (SEC) and introduces a neutral intermediary to every trade, guaranteeing the final settlement of securities and funds in cases of default.