SEBI Approach to Enabling Full-Fledged Short Selling SEBI has been cautiously approaching the regulation of short selling within Indian financial markets. While the board has commenced some initial actions, it seems that SEBI has only taken modest steps towards allowing full-fledged short selling operations. However, this process’s complexity necessitates deliberate, incremental implementation to mitigate potential risks associated with short selling. Permissive Approach and Regulatory Directives on Short Selling In an aid to stimulate the growth […]

New Rules Proposed by RBI on Bank Dividends The Reserve Bank of India (RBI) has recently delivered new proposals regarding the declaration of dividends by banks. This marks nearly two decades since any new update on these regulations. Many industry players have commented that these proposed rules are unlikely to dramatically change the modus operandi of several lenders. RBI’s Proposed Changes to Dividend Declaration The new framework proposed by RBI puts forth several critical changes. […]

RBI Issues Guidelines on Bank Classification of Unclaimed Deposits Periodic Reviews and Fraud Prevention Measures The Reserve Bank of India (RBI) recently released comprehensive guidelines for banks concerning the classification of accounts and deposits as inoperative and unclaimed. These measures include conducting periodic reviews of such accounts and deposits, implementing measures to prevent fraud in these accounts, and providing a grievance redressal mechanism for the expeditious resolution of complaints. RBI guidelines also outline steps for […]

RBI’s Circular on Investment in AIFs: Addressing Compliance Challenges The Reserve Bank of India (RBI) recently issued a circular that could pose both practical challenges and concerns regarding compliance for regulated entities (REs) engaging in investments in Alternative Investment Funds (AIFs). RBI’s Intent: Managi ng “Evergreening” Concerns RBI’s concerns surrounding the practices of loan “evergreening” by REs, including Non-Banking Financial Companies (NBFCs), are indeed justified. The circular is specifically designed to restrict structures permitting REs […]

Introduction: The Union finance ministry has recently addressed speculation regarding potential mergers between public sector banks such as UCO Bank with Union Bank of India and Bank of India with Bank of Maharashtra. The speculation was initially sparked by the ministry’s letter regarding the parliamentary committee meeting, but the ministry has since clarified that the discussions will focus on regulatory mechanisms in a post-merger scenario, not potential bank mergers. This way Finance Ministry Clarifies Parliamentary […]