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SEBI keen on T+1 system, demutualisation: Bajpai

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The SEBI Chairman, Mr G.N.Bajpai (left), and Mr Raghav Bahl, Managing Director, CNBC, at the CNBC-TV 18 Investor Camp in Bangalore on Saturday. — G.R.N. Somashekar

Bangalore , Sept. 25

THE Securities and Exchange Board of India (SEBI) says it can bring about a T+1 (trade date plus one day) settlement system in the Indian market and is only awaiting the nationwide-banking transaction system, the real-time gross settlement system (RTGS) and network to become fully functional and as more banks go on the network, it expects the funds flow to become more organised.

"We have organised the flow of securities and the funds flow has to become organised," said the SEBI Chairman, Mr G. N. Bajpai. He was speaking on the sidelines of a CNBC TV 18-SEBI smart investor programme here on Saturday.

"Indian securities market is broad, deep and wide and is one of the few markets with a T+2 settlement system. We hope to make it a T+1 system soon," he said, but declined to give a time frame for the event.

SEBI has been active in both enforcements and prosecutions of those flouting its guidelines. In 2003-04, SEBI had passed over 340 enforcement orders and had instituted 465 prosecutions against 2,375 persons. In the half year of 2004-05, SEBI has, so far, passed 248 enforcement orders and had instituted 49 prosecutions against 76 people, he said.

Regarding the investigation of charges of insider trading in the GTB case, Mr Bajpai said investigations were on and would be concluded as soon as possible.

RTGS will also go retail, as more branches of banks get on to the network, he said, adding that SEBI was focussed on protecting the investor interest but would also work to develop the market. The corporate debt market needs to be deepened and widened and listing guidelines for trades needs further work, he said. Going forward, SEBI would focus on de-mutualisation of stock exchanges and integrating the securities and commodities markets.

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