Monetary Board Secretary admits to confusion in personal notes and approved minutes

The Secretary to the Monetary Board yesterday acknowledged to certain confusions between his personal notes and the approved minutes pertaining to Monetary Board meetings.

Secretary to the Monetary Board H.A. Karunaratne answered in the affirmative when the Presidential Commission to inquire into the Treasury Bond issue asked whether he has included his own wordings and interpretations into his personal notes as he was manually recording Monetary Board meetings. The Presidential Commission pointed out to Karunaratne that he is assigned to record what goes on in the meeting and not to include his personal interpretations of what is discussed at the Monetary Board meetings.

The confusion between Karunaratne’s notes and the approved minutes was laid bare when Karunaratne told the Commission that Deputy Governor P. Samarasiri requested him to make amendments to the draft minutes of the Tender Board meeting held on February 23, 2015.

“At this meeting, the Governor asked if the CBSL can issue one billion dollar sovereign bonds. He also asked if it is possible to issue half a billion dollar sovereign bonds for 30 years. He also asked about thirty year Rupee Bonds in the local market. DG Ananda Silva said to the Governor that there is not enough liquidity in the market.” Karunaratne explained.

So in my personal notes, I wrote down that the Governor requested to explore the possibilities of issuing 30 year bonds, Karunaratne said.

The Commission then requested Karunaratne to read out a portion from his personal notes based on which prepared the draft minute.

“The Governor asked, should we have a 30 year bond auction? He also mentions the previous Governor also thought of issuing 0.5 billion sovereign bonds in dollars for 30 years as well. This is to facilitate the repayments and the bunging to be sorted out, Governor also says to issue to the local market 30 year treasury bonds this week.” Karunaratne read out.

Supreme Court Justice P. Jayawardane asked Karunaratne from where the wording ‘to explore the possibilities of issuing 30 year treasury bonds’ came into his personal notes.

“What we gather from your notes is that the Governor has given a clear order to issue limited amount of 30 year bonds within that week.” Jayawardane pointed out.

Karunaratne said he wrote it down so because the DG Ananda Silva let the Governor know that there is not enough liquidity in the market to follow the instruction.

DG Samarasiri asked me to change my wording to “the Monetary Board instructed the SPD to raise 30 year treasury bonds within the week.” My original draft minute was given to the DGs on February 26, 2015. So when DG Samarasiri wanted me to change my wording the questioned auction was already over, Karunaratne said.

Justice Jayawardane pointed out to Karunaratne that he should not include his personal understanding of the discussions into the minutes of the Monetary Board to which Karunaratne repeated his earlier explanation.

The Commission pointed out to Karunaratne that he cannot interpret the discussions” and the Commission will judge from your notes whether he has done a proper recording or not”.

The Secretary to the Tender Board was requested to provide his personal notes to be analyzed comparatively with the approved Monetary Board minutes.

Karunaratne was testifying before the Presidential Commission to inquire on the Treasury Bond Issue. State Counsel Shaheeda Barrie led the evidence.

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