The Financial Express (Delhi Edition)
Clearing corporations can’t accept own FDRs as collateral
New Delhi, July 27: Strengthening its risk management mechanism, NSE on Wednesday said its clearing corporation will not accept fixed deposit receipts (FDRs) from trading members as collateral that are issued by the participants directly or through associate entities. The move comes aftermarketsregulatorSebiissued guidelines in this regard.
“NSCCL (National Securities Clearing Corporation Ltd) shallnotacceptFDRsfromparticipants as collateral which are issued by the participants themselves or banks that are associates of participants,” NSE said in a circular.
Participants will not be permittedtoplacefreshFDRsorgo forrenewalof existingFDRsas collateral that are issued by the participants themselves or banks who are associates of participants after August 16, 2016, it added. PTI