The Hindu Business Line : SEBI to launch new IPO refund process on Sept 8

Kolkata, Sept. 2 SEBI would launch the new IPO payment and refund process — Applications Supported by Blocked Amount (ASBA) — with 20 Micron public issue on September 8 on a pilot basis. Mr C.B. Bhave, SEBI Chairman, told reporters at an interactive session, organised by Merchant Chamber of Commerce, here today that five banks — SBI, ICICI Bank, HDCFC Bank, Corporation Bank and Union Bank — will be part of the pilot project.

According to banking sources, though the facility would be available at select branches, the banks would ensure that investors are covered nationally through intra- and inter-bank networks.

Systemic change

Through ASBA, investors’ money will remain blocked in an account till the allotment. Then, the money will be deducted to the extent of allotment and the balance would be immediately available for other purposes.

This would change the payment and refund modes, reducing blocking of investors’ fund and delays in getting the refund.

The systemic change called for a change in software and intermediate processes and linkages. Under the new system, the banks are eligible to act as Self Certified Syndicate Banks (SCBS) in public issues.

After a successful pre-launch testing, the pilot project would verify systemic strengths and weaknesses for an eventual rollout.

Interest rate futures

The SEBI Chairman also said the committee comprising representatives from the RBI and SEBI was working on rollout of interest rate futures by this year.

He, however, did not specify the exact time of the launch, but said the preparatory phase would be shorter than that of the currency futures. To launch currency futures, the regulators took roughly 6 months.

Regarding a viable de-listing route for the tiny cap companies, the SEBI chief said that not only market regulators’ guidelines would be required for such an exercise, but also amendment of rules by the Government would be needed to resolve the problem.

Mr Dave said none of the trade organisations involved in the securities trades were comfortable becoming self-regulatory organisations. Every organisation wants to promote the interest of the members, but when it came to disciplining the erring members, all fought shy.

“It is difficult until mindset is changed.” He, however, felt that it needed to be realised that a clean reputation of an organisation worked in favour of the interests of the members more than anything else.

More Stories on : IPOs | Regulatory Bodies & Rulings

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Sub-broker fined Rs 6 lakh for rigging

Households shift more money into shares, MFs

Mutual funds asset base rises by 2.77% in August

Auto, pharma, bank funds outperform market

Realisation to improve for IT companies

Ranbaxy shares plunge 10% intra-day

Nifty call options attract attention

Exchange traded interest rate futures likely by Dec

FIIs reduce holding in Unitech, Parsvnath Developers

Srei Infra Finance (Rs 109.1): Buy

UCO Bank to tap capital market in Dec quarter

SEBI to launch new IPO refund process on Sept 8