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BSE has signed a memorandum of understanding (MoU) with the The Bank of New York Mellon in New York on September 26 to provide collateral management solutions, said a statement from the BSE.
According to the MoU, BNY Mellon will work with BSE to enable investors to provide collateral which is traded outside of India to the BSE. The MoU would allow for acceptance of "AAA" rated foreign sovereign bonds, as approved by the regulators RBI and SEBI, as collateral for trades done on BSE.
This is expected to increase the ease of foreign investors operating in Indian market and is expected to reduce their costs of collateral and trading in Indian markets significantly over a period of time.
The MoU also aims to enhance the trading experience of foreign institutional and retail investors and bring Indian practices in line with the best in the world.
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