Sebi relaxes SLB guidelines to excite the market
26 November 2012 Mumbai
Image: Shutterstock
In order to revive a lethargic securities lending and borrowing market in India, the Securities Exchange Board of India (Sebi) has relaxed its SLB rules.
The Indian regulator stated in a circular that lenders and borrowers of shares could carry forward their positions up to three months, instead of one month as is the current norm.
The “roll-over facility” states that any lender or borrower who wishes to extend an existing lent or borrow position shall be permitted to roll-over such positions for three months, although rollover shall not permit netting of counter positions.
Sebi also indicated the introduction of liquid Index Exchange Traded Funds as eligible for trading, with the ETF deemed liquid provided it has traded on at least 80 percent of the days over the past 6 months and its impact cost over the past 6 months is less than or equal to 1 percent.
The Indian regulator stated in a circular that lenders and borrowers of shares could carry forward their positions up to three months, instead of one month as is the current norm.
The “roll-over facility” states that any lender or borrower who wishes to extend an existing lent or borrow position shall be permitted to roll-over such positions for three months, although rollover shall not permit netting of counter positions.
Sebi also indicated the introduction of liquid Index Exchange Traded Funds as eligible for trading, with the ETF deemed liquid provided it has traded on at least 80 percent of the days over the past 6 months and its impact cost over the past 6 months is less than or equal to 1 percent.
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