Getting Started

 

Thank you for your interest in becoming a client

If you have any questions please contact one of our Investment Advisors or just click the links below to download the Account Opening Forms and Guidelines. You will need a PDF Reader to open the files.

Equity Trading on the Colombo Stock Exchange

Trading
  • The Colombo Stock Exchange (CSE) offers advanced infrastructure and systems for the trading of equity.
  • The Automated Trading System is an online real-time system which provides for the secondary trading of equity.
  • Post-trade clearing and settlement of transactions are executed through the Central Depository System (CDS)
  • The Exchange is open for continuous trading from Monday to Friday from 9.30 am to 2.30 pm.
  • The settlement for equity transactions is on the third market day after the transaction ie. T+3.
Foreign investments in listed company shares

The issuance of shares by resident companies to foreign investors (non-residents) are permitted without prior approval of the Exchange Control Department subject to certain exclusions and limitations. Movement of funds of such transactions must be through a scheme of account titled “Share Investment Account” (SIA). The SIA would be credited by inward remittances received in convertible foreign currencies from the investors. The dividends and sales proceeds realized on this investment account are remittable through this account.
Non-resident applicants have to open a SIA with a bank in Sri Lanka. The CDS account can be opened only after the SIA is opened. If a Custodian Bank is involved, the Custodian Bank will open the SIA and the CDS Account.

Negotiated Block Trades

Negotiated block trades can be done on the Crossings Board of the Colombo Stock Exchange.
The following are CSE Rules on Crossings

  1. A Crossing shall not take place at a price below 5% of the closing price. No price cap will be enforced
  2. The Transaction value must be more than Rs 20 million OR the size of the parcel should be more than 5% of the issued number of shares.
Ownership Restriction on Banks

The maximum percentage of ownership in the issued share capital carrying voting rights in a bank is 15%. This limit applies to acquisitions or holding of shares by all categories of shareholders, individuals or groups, whether acquired/held directly or through a nominee or acting in concert with any other categories of shareholders.
Prior approval is required from the Monetary Board to acquire shares carrying votings rights in excess of 10% of a licenced commercial bank.
The Monetary Board may grant permission to acquire shares in excess of 15% in the case of a licenced bank which requires restructuring to avoid inadequacy of capital, insolvency or potential failure, subject to the condition that the ownership of shares so acquired shall be reduced to 15% within a specified period as may be determined by the Monetary Board on a case by case basis, provided also that such period shall not exceed five years from the date of granting permission.

Mandatory Offer

The Takeover and Mergers Code requires a Manadatory Offer to be made once a person or group of persons acting in concert acquire a holding of more than 30% of the voting rights of a company. A mandatory offer will also have to be made if a person, either by himself, or with associates or nominees (together holding between 30-50% of the issued shares of a company) acquire 2% or more of the issued shares of the company, during any 12 month period.
In a Mandatory Offer, the price offered for a share should not be less than the highest price paid by the offeror during the previous 12 months.

Withholding Tax

A 10% Withholding Tax is deducted on dividends declared by companies.

Transaction Costs

The Transaction charges for Equity trades on the Colombo Stock Exchange is as follows:

Direct Trades
Share transaction Fee Structure (To be implemented on a step up basis)
Transaction cost band Transactions ≤ LKR 100 Million Transactions ≥ LKR 100 Million
(Note 1)
Brokerage 0.6400 0.2000 (Note 2)
CSE Fees 0.0840 0.0525
CDS Fees 0.0240 0.0150
SEC Cess 0.0720 0.0450
Share Transaction Levy 0.3000 0.3000
Total 1.1200 0.6125
(Note 1) Illustration of shares Transaction Fee Structure when applied on step up basis
Transaction Value (LKR)  102,000,000
 100,000,000 2,000,000 Total
Consolidated Fees (%)  1.1200 0.6125
 1,120,000 12.250 1,132,250
(Note 2) Brokerage fees are indicated as a floor brokerage commission , actual fees may exceed this percentage
Trades through a Foreign Broker
Share transaction Fee Structure (To be implemented on a step up basis)
Transaction cost band Transactions ≤ LKR 100 Million Transactions ≥ LKR 100 Million
(Note 1)
Brokerage 0.3200 0.2000 (Note 2)
CSE Fees 0.0840 0.0525
CDS Fees 0.0240 0.0150
SEC Cess 0.0720 0.0450
Share Transaction Levy 0.3000 0.3000
Total 0.8000 0.6125
(Note 1) Illustration of shares Transaction Fee Structure when applied on step up basis
Transaction Value (LKR)  102,000,000
 100,000,000 2,000,000 Total
Consolidated Fees (%)  0.8000 0.6125
 800,000 12,250.00 812,250.00
(Note 2) Brokerage fees are indicated as a floor brokerage commission , actual fees may exceed this percentage
Intra-day Trading

The transaction fee due to the broker, CSE, CDS and SEC on intra day trades, where a client buys and sells or sells and buys the same security on the same day through the same broker will not be charged on one side of the transaction.
In the event the total number of shares purchased does not equal the total number of shares sold, the transaction fees as detailed above will not be levied on the lower quantity of shares either purchased or sold.
In the event the total quantity purchased is equal to the total quantity sold the transaction fees will not be levied from the sales transaction.
Note: The total purchases and sales of a client in the same security will be considered for purpose of determining the exemption of the Brokerage, CSE, CDS and SEC fees (transaction fee).
Odd lots, Crossing and AON trades will not be considered for the exemption of Brokerage, CSE, CDS and SEC fees.

Corporate Debt

Brokerage – Negotiable
Fees (SEC, CSE & CDS) – 2 Basis Points (Divided equally amongst the three institutions)

Government Debt

Brokerage – Negotiable
Fees (SEC, CSE & CDS) – Nil

Closed End Funds

Fees based on a Percentage (%) of the Transaction value
Brokerage – Negotiable with a Cap of 1 %
CSE Fee 0.02%
CDS Fee 0.01%
SEC Cess 0.02%

Corporate

Account opening forms

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Individual

Account opening forms

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Online Trading

Account opening form

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