News & market updates

Secondary bond yields fell sharply after reports of a possible US–Iran deal, with key maturities trading lower (e.g., 01.07.28 at 9.65%; 15.06.29 ~9.90%; 01.10.32 at 10.70%). Money‑market liquidity surplus was Rs.249.98bn and USD/LKR closed at 321.70/321.80.

Sri Lanka sold Rs8,440 million of treasury bills on tap at average rates of 8.20% (3-month), 8.24% (6-month) and 8.52% (12-month), bringing this week's total bills sold to Rs108,440 million; settlement date May 8, 2026.

JB Financial launched the JB Vantage Credit Opportunity Fund offering an annualised yield of approximately 10.26% with daily invest/redemption and no early-withdrawal penalties (Rs.100,000 minimum; SEC-approved). The actively managed fund targets a mix of government and corporate debt under CIO Sashika Wickremaratne.

Sri Lanka's rupee closed weaker at 321.70/85 per USD on Thursday, while government bond yields fell across maturities (e.g. 01.07.2028 at 9.65/70%, 15.10.2029 at 9.90/10.00%).

Opposition MPs said the appointment of former Deputy Minister Dr. Harshana Suriyapperuma as Treasury Secretary mirrors the 2021 politicised appointment of Ajith Nivard Cabraal as CBSL Governor, during debate over a $2.5m Treasury phishing scandal. They warned the move and the transition of government debt management from the CBSL to the Treasury expose institutional weaknesses and a departure from the tradition of appointing experienced SLAS finance officials.

The weekly Treasury Bill auction was fully subscribed, raising Rs.100 billion in Phase I with the 91-day WAYR at 8.20% and the 364-day at 8.52% (182-day 8.24%). Market liquidity rose to Rs.254.52bn and USD/LKR closed around 320.20/321.00.

Asian stocks rose to record highs as hopes of a Middle East peace deal spurred risk-on buying and sent oil down around 8%, while the U.S. dollar slipped and the yen remained in focus amid intervention speculation.

The Sri Lankan rupee weakened to about 321.00/30 per USD (one-week forward 321.60/90) while government bond yields fell (e.g. 01.07.2028 quoted 9.65/70%). The ASPI rose 0.75% to 22,909 and TT rates showed USD at 317.50/324.50.

Sri Lanka sold all 100 billion rupees of Treasury bills at Wednesday's auction with yields largely unchanged: 3M 8.20% (47.3bn sold), 6M 8.24% (-1bp, 27bn sold), 12M 8.52% (25.58bn sold).

Sri Lanka's rupee closed weaker at 321.00/30 to the US dollar on Wednesday (from 319.90/320.40), while government bond yields were broadly steady — e.g., the 01.07.2028 bond at 9.70/75% and the 15.10.2029 bond at 10.05/15%.

Sri Lanka's rupee weakened to 320.10/60 to the US dollar from 319.90/320.40 the previous day, while bond yields were mostly steady as a 100,000 million rupee Treasury bill auction was underway. The ASPI rose 0.65% to 22,731.

Asian stocks jumped to record highs (MSCI Asia-Pacific ex-Japan +2.3%) as AI-driven buying and signs of progress toward a U.S.-Iran agreement boosted risk appetite; Brent crude fell about 1.2% to $108.51/bbl. Tech and semiconductors led gains while the dollar eased.

Gold rose 0.5% to $4,543.33 per oz after a prior five-week low, with US futures up 0.4%; gains were capped as a crude oil rebound pushed Treasury yields and the dollar higher, reviving inflation concerns and weighing on bullion.

Secondary government bond yields rose for a second consecutive session, with maturities trading from 8.32% (01.08.26) up to about 11.29% (15.09.34). A Rs.100bn T‑bill auction is scheduled, net liquidity surplus was Rs.246.30bn and USD/LKR closed near 319.90/320.40.

Sri Lanka Insurance denied allegations about its participation in the 9 April 2026 Treasury Bond auction, saying it invested Rs.6 billion (Rs.2bn in the 1 Jul 2030 bond, Rs.3bn in the 15 Jun 2034 bond and Rs.1bn in the 1 Jul 2037 bond) with approvals in place and will pursue legal action over false claims.

Sri Lanka's rupee closed at 319.90/320.40 to the US dollar, slightly weaker than the prior 319.60/320.00, while government bond yields edged up on several maturities; 100,000 million rupees of Treasury bills are to be auctioned Wednesday.

Sri Lanka's rupee was quoted at 319.50/320.20 to the US dollar and bond yields were broadly steady. Inflation reached the central bank's 5% target midpoint, the central bank began repo operations while leaving high excess liquidity, and a 100,000 million rupee T-bill auction is scheduled.

Nations Trust Bank (NTB.N0000) absorbed Rs. 36.6bn in assets and Rs. 142.8bn in liabilities from HSBC Sri Lanka’s retail portfolio — including Rs. 31.1bn loans and Rs. 133.1bn deposits — strengthening NTB’s liquidity and funding base.

Merchant Bank of Sri Lanka & Finance PLC (MBSL) proposed a Rs. 999.1 million rights issue of 99,912,312 non-redeemable preference shares at Rs.10 each. The raise, with dividends tied to the five-year Government securities yield plus 100bps (capped at Rs.1.05), is intended to bolster Tier I capital to meet Finance Companies Direction No.3 and address Central Bank restrictions.

Secondary bond yields rose marginally amid Middle East tensions and higher oil prices, with the 15.12.26 at 8.55%-8.65% and longer maturities trading around 10.05%-11.26%. Net money-market liquidity surplus was Rs.226.55bn (Rs.176.10bn at SDFR 7.25%), and USD/LKR closed at Rs.319.60/320.

Merchant Bank of Sri Lanka and Finance plans to raise Rs999,123,120 via a rights issue offering 99,912,312 preference shares (4 new preference shares for every 21 ordinary shares) at Rs10 each. The non-redeemable, non-convertible, non-cumulative preference shares pay a dividend tied to the prevailing 5-year government securities yield plus 100bps (capped at Rs1.05/share); the issue has central bank approval and awaits CSE and shareholder approval.

Sri Lanka's rupee closed at 319.60/320.00 to the US dollar and longer-dated government bond yields edged up (e.g. 01.07.2030 at 10.20–10.25%); inflation reached the central bank's 5% midpoint on April 30.

Secondary bond market ended the week steady with yields broadly unchanged; the 91-day T-Bill yield fell to 8.20%, money-market liquidity rose to Rs.218.70bn, foreign holdings of rupee bonds held at Rs.144.20bn, and USD/LKR closed around 319.75/320.00.

Sri Lanka has seen four fuel price hikes in five weeks, the latest effective May 3 under a cost-reflective formula tied to higher global crude, driving a sharp rise in inflation and living costs. The CPI jump leaves the Central Bank weighing rate hikes against rupee depreciation risks.

National Development Bank (NDB) reported 1Q 2026 PAT of Rs. 1.75 billion after recognising a Rs. 13.2 billion fraud impacting periods up to 1Q 2026. The bank said gross income rose 15.3% YoY to Rs. 26.5 billion, NII grew while NIM held at 3.9% and asset quality showed modest improvement.

Sri Lanka's rupee was quoted at 319.20/320.00 to the US dollar and government bond yields were broadly steady across the curve, with quoted yields around 9.75–11.05%. The ASPI was up 0.41% at 22,641.59 and telegraphic transfer USD rates were 316.30/323.30.

National Development Bank (NDB) reported a post-tax profit of LKR 1.75 billion for 1Q2026 after recognising a LKR 2.67 billion fraud impact in the quarter (total fraud impact LKR 13.20 billion). Core operating income strengthened (total operating income LKR 12.77bn; gross income LKR 26.50bn, +15.3% YoY), NIM 3.9% and impaired loans ratio improved to 3.2%.

Sri Lanka sold 10,040 million rupees of Treasury bills at an average rate of 8.25%, bringing last week's total bills sold to 136.94 billion rupees; the 6-month bill settles on May 4.

Sri Lanka's rupee closed at 319.75/320.00 to the US dollar, slipping below 320 as inflation reached the central bank's 5% target; the central bank intervened around 319.50 and conducted repo operations while bond yields remained broadly steady.