Sebi wants all trading in debt securities settled through clearing houses

The Securities and Exchange Board of India (Sebi) has directed all investors to settle over-the-counter trades on the securitised debt segment on the trade reporting platform of either NSE, BSE or MCX-SX within 15 minutes of the trade.

To ensure that the data is not duplicated, the trades should only be reported on one of the trade reporting platform, SEBI said.

It added that 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.

Further, SEBI said, all trades in securitised debt instruments (listed or unlisted) done between specified entities, like mutual funds, asset management companies (AMCs), foreign institutional investors (FIIs) and their sub-accounts, qualified foreign investors (QFIs), foreign portfolio investors (through custodians), all alternative investment funds, foreign venture capital investors, all portfolio managers and RBI-regulated entities, as specified by RBI, should necessarily be cleared and settled through the National Securities Clearing Corporation Limited (NSCCL) or the Indian Clearing Corporation Limited (ICCL) or MCX-SX Clearing Corporation Limited (MCX-SX CCL).

SEBI also directed the reporting platforms to provide continuous data pertaining to securitised debt market to provide transparency and efficient pricing of securitised debt instruments.

Such data should cover issuer name, ISIN number, face value, maturity date, current coupon, last price reported, last amount reported, last yield (annualised) reported, weighted average yield/ price, total amount reported and rating of SDI, SEBI said.

The exchanges should also provide on their websites offer documents/continuous disclosures, if any, relating to the securitised debt instruments traded and such other additional information pertaining to the trade/reporting.

Sebi has directed NSE, BSE , MCX-SX and clearing corporations of these exchanges to make amendments to the bye-laws, rules and regulations for the implementation of the decision with effect from 1 April 2014.

Sebi had, on 24 January 2013, issued guidelines for providing dedicated debt segments on stock exchanges, which stated that the debt segment will also offer separate trading, clearing, settlement and reporting facilities in securitised debt instruments (as defined in SEBI (Public Offer and Listing of Securitised Debt Instruments) Regulations, 2008).

BSE, NSE and MCX-SX have already set up dedicated debt segment in accordance with the said circular.