Sebi also proposed to bring more classes of financial instruments, including insurance policies and fixed deposits, under the ambit of asset categories that can be held in demat or electronic form.
The proposed move is expected to make it simpler to maintain and safe-keep various kinds of financial instruments, as the risks, like loss and theft get minimised in demat form, as compared to the physical paper form.
At present, all securities traded in capital markets such as equity shares and mutual funds can be held in demat accounts, maintained by two depositories NSDL and CDSL, which come under Sebi’s jurisdiction.
After its board meeting here, Sebi said, “There have been demands for dematerialisation of assets/records other than securities, such as, warehouse receipts, fixed deposits with banks and corporates, insurance policies, investment products of post office, etc.”
To expand the list of asset classes which can be held in demat form, Sebi said, it has decided to initiate steps that would enable an investor to view the details of his holdings and transactions across all asset classes through a single consolidated statement.
“The board approved proposal to amend the Sebi (Depositories & Participants) Regulations to enable depository to share the necessary information/data with its Strategic Business Unit (SBU) with respect to the assets/instruments held by them for the purpose of generation of consolidated statement,” Sebi said.
Under Sebi regulations, the depositories are permitted to take up activities assigned by the central government or by a regulator in the financial sector, through the establishment of a Strategic Business Unit (SBU).
In another decision regarding the depositories, Sebi said its board approved a proposal to amend the existing norms to enable the market regulator and the depositories to take action against issuers found non-compliant with regulations related to timely dematerialisation of shares, maintenance of proper records etc. These regulations also include issuers’ agreement with the depositories, carrying out reconciliation of share capital, among others.
Sebi said it has come across instances of non-compliance such as lack of reconciliation of issued or listed capital and actual share capital by the issuer company and its appointed Registrar and Transfer Agent).
‘Inform investor on penal action’
Mumbai,pti: It asked stock exchanges to inform investors well in advance about any potential penal action against companies not complying with minimum public shareholding, the deadline for which expires next year.At the same time, Sebi gave a respite to listed companies seeking to sell shares through Follow-on Public Offers (FPOs), saying that the profitability criteria would not be applicable to them and even loss-making companies can launch FPOs.
The companies are required to have a three-year profit record for IPOs, but there was a lack of clarity with regard to FPOs.
Regarding the minimum public shareholding norms, the market regulator asked the bourses to carefully monitor the adherence of the companies to the norms, which require a minimum public holding of 25 per cent for private sector companies by June 2013 and 10 per cent for PSUs by August, 2013.
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