By Shihar Aneez
COLOMBO, Dec 22 (Reuters) - Sri Lankan shares fell 1.11 percent on Monday to a four-year closing low on worsening investor sentiment, after the revelation of a credit card scam at an affiliate of one of the country's biggest conglomerates.
The rupee fell 0.13 percent to a new 14-month low on importer demand for greenback, dealers said.
The Colombo All-Share index .CSE fell 16.97 points to 1509.79, its lowest close since Jan. 3, 2005.
The market has fallen 40.6 percent so far this year. due to poor earnings, high borrowing costs, and global woes.
A court ruling to halt hedging payments for five banks, sovereign rating cut, and a government delay to implement a court order on petrol price cut also hurt the bourse, analysts said.
"The credit card scam announced by Ceylinco Consolidated created some uncertainties in the market," said Mohandas Thangarajah, a stockbroker at First Guardian Equities. "The group has nine companies listed in the bourse."
Ceylinco Consolidated, one of the corporate leaders with more than 300 companies in Sri Lanka, announced a credit card scam in one of its non-listed companies but declined to say how much money was involved.
Analysts and traders said though the failed company was not listed, there was a spillover effect to its listed companies.
Non-voting shares in Seylan Bank SEYB_p.CM, a company under Ceylinco Consolidated, fell 8.7 percent to 5.25 rupees, on a weighted average, while another subsidiary company, The Finance Company TFC.CM closed 1.75 percent weaker at 28 rupees.
Top mobile phone operator Dialog Telekom DIAL.CM fell 8 percent to its life closing low of 5.75 rupees a share, while market heavyweight and country's No.1 fixed-line phone operator Sri Lanka Telecom SLTL.CM shed 2.4 percent to 30.50 rupees.
Top conglomerate John Keells Holdings JKH.CM closed 1.82 percent weaker at an over 4-½ year closing low of 55 rupees.
The market turnover was 18.6 million rupees ($0.17 million), a fraction of last year's daily average of 400 million rupees. It hit a seven-year low of 13.1 million rupees on Dec. 4.
The rupee closed at 112.00/10 per dollar, weaker than Friday's close of 111.85/95, its lowest close since Oct. 24, 2007. It has fallen around 1.8 percent since central bank allowed gradual depreciation on Dec. 8.
"A state bank bought dollars at 112 level to cover some import bills," said a currency dealer.
Dealers and traders said yields in secondary market short-term treasury bills and bonds rose by around 1 percent as a foreign bank sold them to raise money, instead of resorting to expensive market credit. The interbank lending rate or call money rate CLIBOR edged up to 13.475 percent from Monday's 13.348 percent.
For secondary market rates, please see <0#LKBMK=>.