Regulations
SAT upholds SEBI's 'unfit' order against Financial Technologies
In an order by majority view, the SAT said that as the time granted to FTIL for divesting its stakes had already expired and the company can take another four weeks to exit its holdings
 
The Securities Appellate Tribunal (SAT) on Wednesday dismissed Jignesh Shah-promoted Financial Technologies’ (FTIL) plea against market regulator Securities and Exchange Board of India (SEBI)'s order declaring the company unfit to own stakes in market infrastructure institutions. SAT said that decisions by financial market regulators have bearing on each other.
 
The SAT also gave FTIL four weeks to divest its stakes in bourses, including MCX-SX.
 
SAT's presiding officer JP Devadhar said the moot question was if the orders of one regulator have a bearing on others, and ruled in favour of SEBI saying the trades regulated by the commodity markets regulator Forward Markets Commission (FMC) are similar to those regulated by SEBI.
 
SEBI had passed its orders following a similar order by FMC after the Rs5,500-crore scam at National Spot Exchange Ltd (NSEL), 99.99% owned by FTIL, came to light.
 
Stating that there were differing views within the three-member Bench, Devadhar said the order was being passed as per the majority view. SAT member AS Lamba had the contrarian view and termed SEBI order as “unprofessional”.
 
Devadhar said order passed by one regulator would have to defacto apply to other regulators and not following this principle would defeat the spirit of regulation.
 
He said that as the time granted to FTIL for divesting its stakes had already expired, the company can take another four weeks to exit its holdings.
 
FTIL owns 26% in commodities bourse Multi-Commodity Exchange (MCX) and has a 70% stake in MCX-SX and MCX-SX Clearing Corporation.
 
Its MCX-SX ownership is 5% through equity and the rest through convertible warrants. At the time of the SEBI order FTIL and MCX held just under 5 per cent stake in the stock exchange MCX-SX.
 
The troubled company also has stakes in the Delhi Stock Exchange and Vadodara Stock Exchange in addition to a small holding in the NSE.
 
The SEBI had passed an order on 19th March stating that FTIL was not “fit and proper” to hold any stakes in any of these exchanges. The SEBI order followed a similar one on 17 December 2013 by commodities watchdog FMC against the company and its promoter Jignesh Shah and key officials like Joseph Massey.
 
FTIL has also challenged the FMC order of December last year in the Bombay High Court, which is yet to conclude the hearing.
 

User

Govt revises format of OBC caste certificate
Difficulties were being faced as the OBC caste certificate had space for mentioning the name of the   caste or community but no space for indicating the specific resolution by which the said caste or   community has been included in the central list
 
The union government has revised the format of caste certificate for other backward class (OBC) to make it easier for them to get the benefit of reservation.
 
Representations were being received from OBC candidates citing difficulty in getting the benefit of reservation, Minister of State for Personnel, Public Grievances and Pensions Jitendra Singh told Lok Sabha in a written reply.
 
Difficulties were being faced as the caste certificate had space for mentioning the name of the caste or community but no space for indicating the specific resolution by which the said caste or community has been included in the central list of OBC, he said.
 
“The issue was examined in consultation with the National Commission for Backward Classes and the format of the OBC certificate has since been revised,” the Minister said.

User

Asset quality improvement in banking is one-two quarters away

According to Edelweiss Securities, private banks are likely to fare well due to better risk management practices, strong liabilities traction and robust capital positions compared with PSU banks

Over the past few months, foreign fund flows have been strong and equity markets have been riding on the expectation of green shoots for pick up in industrial activity bolstered by a pro-business government. However, Edelweiss Securities Ltd feels that asset quality improvement for banking and financial services sector is still one to two quarters away.

 

"Private banks are likely to fare well due to better risk management practices, strong liabilities traction (set to capture growth) and robust capital positions. We continue to prefer large-cap private banks—Axis Bank, ICICI Bank. Also, we await clarity on capital raising by public sector (units) (PSU) banks, which is likely to be addressed in budget," said the report.

Edelweiss said, the first quarter of FY15 is expected to be a seasonally weak quarter for credit growth (industry up 14% year-on-year (YoY) and flat quarter-on-quarter (QoQ)), while contribution of cyclical factors to growth is some time away. Stable money market cost of funds is likely to be flat, but Q4 FY13 priority sector lending (PSL) build up can depress yields. While net interest income (NII) will track the credit growth number, other income is likely to be weak, though treasury income from equity book could buoy it a little. Credit cost is not likely to dip meaningfully, which together with introduction of provisions for un-hedged forex exposure of borrowers, will pressurise profit after tax (PAT), it added.

 

According to the report, banks have been selling restructured accounts to asset reconstruction companies (ARCs) before they turn into non-performing assets (NPAs), though it’s still early to label it a trend. Power finance non-banking finance companies (NBFCs) are likely to report stable asset quality, but auto NBFCs’ recovery could be delayed, Edelweiss said.

User

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)