Professional Documents
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Large Corporates split CMD’s post in light of SEBI Directive
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SEBI Directives
• SEBI has asked listed companies to split the post of Chairman and
Managing Director by April 2020.
• It has also made it compulsory for them to have six independent
directors on board, including a women director.
• The changes, which were first recommended by Kotak Bank chief
Uday Kotak-led committee on corporate governance few months
ago, have now been accepted and notified by SEBI.
• For implementation of changes with regard to split of CMD post, SEBI
has set a deadline of April 1, 2020.
• The deadline for independent directors and other rules is April 1,
2019.
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SEBI allows longer trading hours for SLB segment
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SLB (Stock Lending and Borrowing) segment
• SLB segment is typically used by institutional investors to lend or
borrow the shares.
• Early this year in March, SEBI announced the introduction of physical
settlement in the derivatives segment.
• Physical settlement refers to a mechanism wherein contracts are
settled by giving or taking shares instead of cash.
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SEBI initiated probe in 117 new cases in fiscal year 2018
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MCX receives recognition from Sebi for MCXCCL
• Multi Commodity Exchange of India
Ltd. (MCX) received recognition from
SEBI for its Multi Commodity
Exchange Clearing Corporation
Limited
• MCXCCL - first clearing corporation in
the commodity derivatives market.
• MCXCCL, a wholly owned subsidiary MCXCCL will be the central
of MCX, will soon commence its counterparty for all trades executed
on MCX’s trading platform. It will
operations collect margin from the members,
• It will undertake collateral effect pay-in and pay-out and oversee
management, risk management delivery and settlement process, and
functions and clearing & settlement will also facilitate deliverie.
of trades executed on the Exchange.
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Multi Commodity Exchange of India
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SEBI has done away with category of Sub-Brokers
• Sebi has done away with the category of sub-
brokers as market intermediaries, which
require registration with the regulator.
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Who is sub-broker ?
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37 PSUs yet to comply with Sebi's public float norm
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What is “float”?
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Investments through P-Notes plunges to 9 year low
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SEBI on P-Notes
• In July 2017, Sebi had notified stricter norms stipulating a fee of USD
1,000 on each instrument to check any misuse for channelising black
money.
• It had also prohibited FPIs from issuing such notes where the
underlying asset is a derivative, except those which are used for
hedging purposes.
• In April last year, the Securities and Exchange Board of India (Sebi)
had barred resident Indians, NRIs and entities owned by them from
making investment through P-notes.
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Sebi plans ‘on tap’ bond market
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Features of On Tap Bond Issue
• After filing the tap bond issue prospectus, a corporate can decide
when to enter the market.
• In ‘tap’, a string of formalities like dealing with the registrar,
merchant banker, or issuing new advertisements and application
forms can be done away with.
• It can be multiple times during a financial year depending on the
fund need and market appetite.
• On tap market, which thrives in financial centres like London, would
particularly benefit certain sectors like non-depositing taking non-
banking finance companies which are regular issuers.
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MCQ’s
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1. Which of the following is incorrect w.r.t. SLB (Stock Lending and Borrowing) segment of stock exchanges?
a) It is typically used by institutional investors to lend or borrow the shares
b) SEBI recently allowed stock exchanges to extend the trading hours of SLB segment
c) Early this year, SEBI announced the introduction of physical settlement in the derivatives segment
d) None of the above is incorrect
2. Which of the following is/are correct w.r.t Multi Commodity Exchange of India?
a) It was established in 2003.
b) It is based in Mumbai.
c) It offers options trading in gold and futures trading in non-ferrous metals
d) All are correct
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3. Float is an important term associated with stock markets. It is calculated by:
a) adding closely held shares to the total shares outstanding
b) subtracting widely held shares from the total shares outstanding
c) subtracting closely held shares from the total shares outstanding
d) None of the above
4. _______ are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be
part of the Indian stock market without registering themselves directly.
a) M-Notes
b) P-Notes
c) S-Notes
d) T-Notes
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ANSWERS
1. D
2. D
3. C
4. B
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SEBI Current Affairs - August 2018
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Thank You! Happy Learning!
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