The Hindu Business Line : BSE poised to launch trading in corporate bonds

The BSE, which was chosen by the SEBI to create a platform for trading in corporate bonds, is ready with the system, according to Mr Rajnikant Patel, Managing Director and CEO of BSE.

"We are ready with software and applications. Subject to regulatory clearance, we can launch the trading platform next month," he said, speaking to newspersons on the sidelines of a workshop on corporate bond market in India, organised by the World Bank jointly with the Finance Ministry.

Following the Government decision to set up a single unified exchange-traded market for corporate bonds (announced in the Union Budget), the SEBI had worked out a roadmap and selected the BSE to set up a trading platform.

The Government's decision was based on the R.H. Patil Committee report on corporate bonds.

The Committee had suggested the NSE's name for hosting the platform, but an internal SEBI committee decided in favour of the BSE.

Mr Patel said that the trading process could be slow, as is the case when any over-the-counter trade is converted to exchange trade.

The "order matching system", as in the case of equities, would be introduced in a phased manner, he added.

Several issues such as stamp duty, multiple regulators, and legislative restrictions, were discussed at the workshop.

Mr Ravi Mohan, Managing Director of Crisil, said that there would be several regulators such as the RBI, the SEBI, and the IRDA, regulating investments in corporate bonds.

But Mr Patel said that it is not possible to expect watertight compartmentalisation of regulators.

Multiplicity of regulatory authorities is not new and is also the case in several other countries.