Chairman of the SEC

Chairman of the SEC

Mr. Salieh is The Immediate Past Chairman of the Sri Lanka Institute of Directors, which is committed to empowering Directors from both the private and public sectors with insights and skills to assume their roles and to groom a new generation of Boardroom Leaders.

Mr. Salieh brings a wealth of experience to his job, having over 40 years of extensive experience in commercial and development banking both in Sri Lanka and overseas. He was Chief of Corporate & Merchant Banking at ANZGrindlays Bank; COO of NDB; Executive Director/CEO of NDB Housing Bank; founder MD/CEO of Amana Bank; and Senior Independent Director of Cargills Bank and HNB General Insurance.

Mr. Salieh played an outstanding strategic and operational leadership role in establishing Amana Bank as the first interest-free licensed commercial bank operating on the profit and loss sharing model in Sri Lanka. He has held Board positions in several companies in the business of Banking, Finance, Insurance, Fund Management, Stockbroking, Manufacturing, Trading and Education; he has served on State University Boards, Ceylon Chamber of Commerce and several Government and Non-Governmental Committees in the fields of Finance, Economic Affairs, Housing, Construction and Tertiary Education. Mr. Salieh holds a First Class Honours Degree in Economics with specialization in Banking & Finance, MBA and FCPM.


I am pleased to present this annual report for the year ended 2022, following my appointment as Chairman of the SEC in February 2023. As most countries gradually rebounded from the COVID-19 pandemic in the year 2022, Sri Lanka grappled with its worst economic crisis which came about from a confluence of factors and resulted in contraction of output, soaring inflation and acute foreign exchange scarcity which led to shortages in essential commodities, high interest rates and difficulties in servicing external debt. These were some of the challenges against which, the SEC pursued its regulatory and development mandate in 2022. Despite these challenges, we were committed to facilitating capital formation and protecting investors by reducing the regulatory burden, ensuring compliance, strengthening enforcement and enhancing financial literacy, the key highlights of which are provided in this annual report.


Accurate, timely and reliable disclosures build investor confidence and are a cornerstone of a robust and efficient capital market. Through our continuous disclosure review program, we remained committed to ensuring that Listed Companies are compliant with financial reporting standards and disclosure regulations. Significant deficiencies and misleading disclosures were communicated to the companies in order that they resolve the issues and improve the quality of disclosures; and in some instances of non-compliance we undertook rigorous enforcement action. We engaged with companies and external auditors to ensure that investors receive accurate, transparent and timely information especially during uncertain and volatile conditions which impacted cash flows, operations, financial performance and business prospects. With the increased focus on sustainable finance, we will make concerted efforts with our stakeholders towards creating awareness and facilitating the implementation of sustainability disclosures by listed entities.



As a consequence of the enactment of the new SEC Act in 2021, we introduced new Rules pertaining to Market Institutions, Market Intermediaries, and a Code for Collective Investment Schemes (CIS) to build trust and resilience in our market by encouraging good conduct, the promotion of responsible business, enhancing governance standards as well as cultivating self-regulation and a compliance culture. The SEC adopted a robust process to develop the Rules and incorporate feedback from regulated entities, minimise the regulatory burden and protect investors. The effective supervision of regulated entities is central to the SEC’s regulatory role. In order to mitigate any systemic risk arising from regulated entities to the capital market, we strengthened the supervision of regulated entities through an effective risk – based supervision framework for both on-site and off-site supervision. During the year under review, the key measures that enabled regulated entities to remain operationally resilient despite the many significant disruptions, included robust systems, effective governance arrangements, information security and effective business continuity plans.


The digitalization of the stock market culminated in a surge of retail investors to the CSE. In 2022, a significant increase was observed in the number of retail investors, particularly amongst investors below the age of 40 who turned to social media platforms to learn about investing and obtain investment guidance. As these new channels have emerged, so have concerns about the credibility of information. During the year, we took steps to identify and take enforcement action against potential market misconduct carried out through social media posts. We continued to deliver investor education programs to ensure that investors have proper access to financial education and are able to verify and understand the information generated by various channels and make informed investment decisions.


Amidst market volatility, we heightened the monitoring of market activities to ensure timely detection of trading irregularities in order to enhance investor protection and build investor confidence. Over the years, as a consequence of the extensive use of internet and digital media, the speed at which non-public information can be transmitted and misused has notably increased. The SEC endeavoured to put a check on such fraudulent stock tips circulated through social media and initiate timely and proportionate enforcement action. Rapidly changing technology poses novel challenges and data has become the backbone of surveillance. In continuation of our efforts to unearth complex market misconduct, we adopted various innovative techniques such as pattern recognition and data analytics using a web-based platform with robust tools for analysis. Where breaches were identified, the SEC deployed a range of enforcement tools under its administrative, civil and criminal powers. The future of surveillance will entail further deployment of technology to detect and curb more complex and evolving market manipulation techniques.


On the development front, the SEC continued to facilitate the introduction of new products and platforms to add depth to our market and provide options to a wide range of investors with different trading strategies, risk appetites and investment horizons. Supporting the development of green and sustainable finance is a key focus for the SEC. As part of this effort, in collaboration with the CSE we are spearheading the introduction of Environmental, Social and Governance (ESG) based products and an ESG Index to generate a positive impact to the economy, community, and environment. Other products which are to be introduced in the foreseeable future include stock borrowing and lending, regulated short selling, Islamic Capital Market Products, Gold Exchange Traded Funds (ETFs), Infrastructure Bonds, OTC Platform to carry out REPO transactions, etc.


The Financial Literacy Survey conducted by the Central Bank of Sri Lanka (CBSL) in 2021 revealed that 57.9 % of adults are financially literate in Sri Lanka. Despite this, there is still a wide scope to improve the financial knowledge of Sri Lankans. Financial literacy is a life skill and it is critical that we impart financial knowledge from a young age. We are hopeful that an appropriate capital market content will be included in the subject “Entrepreneurship and Financial Literacy” from Grade Six onwards in the revised school curriculum in 2023. It is also imperative that we reach the new generation of investors who are comfortable trading on smartphones and automated devices, and are likely to seek inputs on investment decisions from online sources. For this reason, our efforts included imparting investment knowledge by way of social media postings on Facebook, Youtube, and Twitter on a regular basis in a fun and interactive way. We cautioned investors to avoid becoming victims to potential scams and advised them to exercise utmost caution when making investment decisions. While our online efforts reached a significant number of individuals in a cost-effective manner, the SEC recognised the impact of in – person events and in collaboration with the CSE conducted many outreach programs throughout the country.


The SEC continued to pursue regular, timely and proactive engagements with a wide range of stakeholders using multiple channels, including speaking engagements, consultations, industry briefings, circulars, publications, press releases and annual reports to increase two-way communication. These engagements were conducted to provide updates on our regulatory expectations and development initiatives and provide opportunities to stakeholders to express their concerns and views in relation to policies and regulations. Continuous dialogue with market participants enables the SEC to gauge the pulse of the market and keep abreast in relation to new policy and regulatory development in the securities market.

As a member of the International Organisation of Securities Commissions (IOSCO) with representations in two of its policy committees, namely the Committee on Enforcement and the Exchange of Information (Committee 4) and the Committee on Retail Investors (Committee 8), the SEC continues to contribute to international standard setting initiatives and thought leadership. In the wake of the COVID-19 pandemic and IOSCO’s decision to hold frequent virtual meetings, the SEC participated in several work streams of IOSCO and was able to share and learn from experiences and good practices of various other international jurisdictions.


The capital market’s performance is severely constrained by the prevalent economic crisis situation. However, we do remain positive and hopeful of its recovery and growth as the economic situation eases and changes for the better. Now is the time to re-build investor trust and confidence in the market through relevant and effective regulation, operational efficiencies and the introduction of new and attractive products.

A key challenge for the SEC in 2023, amidst the external economic crisis, will be building the necessary internal capacity to enhance the effectiveness and efficiency of its regulatory role and responsibilities under the new SEC Act. In this context, there are critical issues that need to be expeditiously addressed in the HR and Technology spaces of our operations, particularly the acquisition and retention of good talent and the commissioning of appropriate technological support systems relevant to a specialist standards-setting and regulatory institution in the capital market. The new Act provides extensive coverage for capital market expansion and effective regulation. In order to deliver enhanced performance under the Act, the SEC needs to attract and invest in people with relevant specialist skills. This will be a key focus area for the Commission.

In conclusion, I would like to thank our Commission Members for their insightful contributions, support and guidance to the SEC, and the Director General and staff of the Secretariat for their commitment and tireless work. I am grateful to the President Hon. Ranil Wickremesinghe and the officials of the Finance Ministry for placing their confidence in me and the new Commission Members.

Chairman’s Office


Phone : 0112 143810