Sebi planning common clearing house for SEs

Mumbai, Aug 30: Sebi is considering a proposal to establish a common clearing house for the purpose of streamlining trade settlement opera...

Mumbai, Aug 30: Sebi is considering a proposal to establish a common clearing house for the purpose of streamlining trade settlement operations, chairman D R Mehta said here today.

Mehta said Sebi had already requested the Reserve Bank of India to give limited banking powers to depositories and clearing houses (for settlement of trades only). Among other initiatives being taken were securitisation of loans, expansion of the scope of derivatives trading with likely introduction of index options by November end this year and inclusion of ‘A’ group scrips in rolling settlement mode, also by end of the year.

Sebi, he said, was trying to bring about greater coordination among the various players in the stock markets beginning with the brokers, depository participants, clearing houses and the banks, he added.

Story continues below this ad

Mehta said Sebi had been successful in managing change, by doing it in small doses which was not immediately appreciated by market players and intermediaries who criticised it initially. "But we have proved that change is best managed in small, decisive moves like the depository which now accounts for nearly 95 per cent of settlement value in the major bourses."

He explained that the move towards a rolling settlement and T+5 system would be possible only with electronic funds transfer system for which Sebi had already initiated discussions with RBI and expressed the hope that this would be possible once RBI gets the necessary transponders and banks have the requisite

Meanwhile, as brokerages compete for a piece of the cake by slashing charges, Anand Rathi Securities has announced a flat-fee brokerage for the first time in the country. Incidentally, it has also become the first to launch its online trading product- Anand Rathi Direct- on both BSE and NSE.

The trading portal was formally launched today by Sebi chairman DR Mehta by executing the first trade. Speaking on the occasion, Mehta said Sebi research showed that India had the second lowest transaction cost in the world, after the USA, at 30 basis points compared to 2 basis points in the USA. "We are gradually moving to levels in USA," he added.

Story continues below this ad

Managing director of the broking firm, Anand Rathi, said from inception in 1995 till date the group had come a long way to be among the top 10 broking houses in the country. "Between Anand Rathi Securities and Navratan Capital (NSE member and associate company of Anand Rathi) we have 60 franchisees in 40 cities and 150 trading terminals and have a strong team of 10 equity analysts," he pointed out.