Facilitating the development of a transparent, liquid, and efficient government securities market in Sri Lanka

The Association of Primary Dealers in Sri Lanka (APD) is the representative body of licensed primary dealers appointed by the Central Bank of Sri Lanka (CBSL). APD works to promote transparency, efficiency, and integrity in the government securities market, while serving as a bridge between the Central Bank, market participants, and the investing public.

Primary Dealers are licensed institutions authorized by the Central Bank of Sri Lanka to participate directly in auctions of government securities, such as Treasury Bills and Treasury Bonds. They play a vital role in ensuring liquidity and the smooth functioning of the government securities market.

Treasury Bills are short-term debt securities issued by the Government of Sri Lanka through the Central Bank, typically with maturities of 91, 182, or 364 days. They are sold at a discount to face value and redeemed at par on maturity. Investors earn a return equal to the difference between the purchase price and the face value.

Treasury Bonds are medium- to long-term debt instruments issued by the Government of Sri Lanka, usually with maturities ranging from 2 to 20 years. They carry a fixed coupon (interest rate), paid semi-annually, and the principal is repaid at maturity. Treasury Bonds provide stable income to investors over a longer period compared to T-Bills.

Treasury Bills and Bonds are issued through auctions conducted by the Central Bank of Sri Lanka. Licensed Primary Dealers participate directly in these auctions. Individual investors can purchase securities by contacting a Primary Dealer or through commercial banks that act as intermediaries.

APD ensures that Primary Dealers adhere to best practices, promotes market efficiency, and engages with the Central Bank on behalf of its members. It also works to educate market participants and the public about government securities.

Since both Treasury Bills and Treasury Bonds are issued by the Government of Sri Lanka, they are generally considered low-risk investments, backed by the sovereign guarantee of the government. However, market risks such as interest rate fluctuations can affect their trading value in the secondary market.

Auction results and issuance details are published by the Central Bank of Sri Lanka (CBSL) and are also shared by Primary Dealers. APD may also provide links or references to such data on its official website.