The Treasury is investigating the controversial NSB-TFC deal and the resignation of the entire NSB board would help it conduct an effective inquiry, Treasury Secretary Dr. P. B. Jayasundera said yesterday.

He told journalists that the Post Master General D. L. P. R. Abeyrathne was filling in as temporary Chairman of the NSB. "We are still finding replacement for the board and I hope we won’t have to find a new Post Master General," Dr, Jayasundera said jokingly.

"The inquiry is at an early stage. We want to be fair by all concerned. The fact that the board has resigned will help us conduct an effective inquiry."

Former NSB Chairman Pradeep Kariyawasam tendered his resignation with a letter to the Treasury Secretary. "He said he was being unfairly criticized," Dr. Jayasundera said.

"It is important to invest in the capital market as well but we the public sector is at an early stage and this incident is a hiccough in our learning curve," he said.

He went onto say that the public sector was not ready for such transactions and before it ventured into investing in the capital market a code of ethics and good governance would have to be formulated first. Exposure limits would also have to be set and audit and investment committees would have to be formed comprising competent personnel.

"We will be issuing a circular on this regard to all state-owned enterprises," Dr. Jayasundera said.

He said steps will be taken to ensure these committees were free from interference.