SEBI also asked investors to settle over- the-counter trades in securitised debt through registered clearing houses
Mumbai : Market regulator Sebi said all trades in securitised debt instruments or certificates will be reported on stock exchanges within 15 minutes of the transaction, a move that will improve transparency, reports PTI.
“All trades in securitised debt instruments (listed or unlisted) by Mutual Funds, FIIs /Qualified Foreign Investors/ Foreign Portfolio Investors, Alternative Investment Funds, Foreign Venture Capital Investors and Portfolio Managers shall be reported on trade reporting platform of either NSE, BSE or MCX-SX within 15 minutes of trade,” Sebi said in a circular.
Further, the regulator said that all trades in securitised debt instruments done between entities including Mutual Funds, FIIs, Alternative Investment Funds and portfolio managers and RBI regulated entities, will mandatory be cleared and settled through the National Securities Clearing Corporation Ltd or the Indian Clearing Corporation Ltd or MCX-SX Clearing Corporation Ltd. The decision will be effective from April 1, this year.
To ensure that the data is not duplicated, Sebi said the trades will be reported on only one of the trading platform. The reporting for a trade must be done by the buyer and the seller on the same platform to ensure matching of both sides of the trades, the Securities and Exchange Board of India (Sebi) said. The move will help in developing securitised debt instrument market and improve transparency.
Securitisation involves pooling of financial assets and the issuance of securities that are re-paid from the cash flows generated by these assets. Common assets for securitisation include credit cards, mortgages, auto and consumer loans, student loans, corporate debt, export receivable and offshore remittances.