PABC primary dealer licence suspension extended for further 6 months

by nishel fernando

Pan Asia Banking Corporation PLC (PABC) yesterday said the Central Bank has extended the suspension of its primary dealer licence for an additional six months, effective from August 15, 2025. 

This marks the latest in a series of extensions since the initial suspension in August 2017.

In a disclosure to the Colombo Stock Exchange, PABC noted that the bank had been formally informed of the extension by the Central Bank. 

The bank emphasised that the continued suspension of its primary dealership would not impact its regular banking operations or its trading activities in the secondary market.

The suspension is linked to an ongoing investigation into PABC’s transactions with Perpetual Treasuries Ltd, a key entity in the 2015 Central Bank bond scandal. 

The initial regulatory action was taken based on the findings of an investigation into PABC’s dealings in the government securities market with Perpetual Treasuries.

The broader bond scandal involved allegations of ‘pump-and-dump’ trades, where bonds were allegedly sold to Pan Asia Bank and another bank, which then sold them to the Employees’ Provident Fund (EPF), at inflated prices. This resulted in significant profits for Perpetual Treasuries and alleged losses for the state and EPF.

Since 2017, the Central Bank has been periodically extending the suspension of Pan Asia Bank’s primary dealer licence as investigations continue.

A primary dealer is a financial institution authorised to trade directly in government securities auctions. While this suspension restricts PABC’s access to these primary auctions, the bank has reiterated that its other services remain unaffected.

The announcement was made under Section 8 of the Listing Rules of the Colombo Stock Exchange.