Mr. M Damodaran, Chairman, Sebi, while announcing the decision on the new policy on P-notes, said that this was not a board meeting to decide on a single issue. Speaking to mediapersons after the Sebi board meet today, he said the stock exchanges would be mandated to constitute a committee chaired by a non-executive member of a concerned exchange to focus on surveillance. This, he feels, would make the market a safer place for investors.
The meet also saw new policy announcements like clearing of Sebi's proposal to have an SME exchange.
But the most awaited decision on P-notes was that the board has decided that FIIs and sub-accounts shall not issue P-Notes as underlying as derivatives.
"All current position to be wound up within 18 months. Further issue of PNs by sub-accounts will be discontinued with immediate effect," Damodaran said.
Highlights of M Damodaran's announcements at the Sebi Press Conference:
# Sebi board cleared proposal to have a separate exchange for SME Segment
# Date of calculation of AUC will be Sept 30
# Sub accounts not to be allowed to issue PNs
# PNs can't be issued with ODIs as underlying
# FIIs shall not issue P-notes as underlying as derivatives has been approved
# Current position to be wound up within 18 months
# Board has decided further issuance of P-notes by sub accounts of FIIs to be discontinued with immediate effect
# Sub accounts issuing P-notes have applied for registration of FIIs: Sebi
# Until a final decision is taken on their being FIIs, sub accounts can continue as normal
# Both proprietary and corporate sub-accounts will be allowed to do business till final decision is announced.
