Regulations
SEBI reduces timeline for transfer process of equity shares

SEBI reduced the time-line for registering the transfer of shares to 15 days from 30 days to expedite the transfer process in the interest of the investors

New Delhi: In a move to expedite the transfer process of equity shares market regulator Securities and Exchange Board of India (SEBI) has reduced the timeline for registration of transfer of shares to 15 days from the existing one month, reports PTI.

It also decided to reduce the time period for transfer of debt securities to 15 days. The new directive will come into effect from 1st October, this year.

"With a view to expedite the transfer process in the interest of the investors, it has been decided, in consultation with Registrars Association of India, Stock Exchanges and market participants to reduce the time-line for registering the transfer of shares to 15 days," SEBI said in a circular today.

The same time-line shall also be applicable for transfer of debt securities, it added.

"This circular is issued in exercise of powers conferred under SEBI Act, 1992, to protect the interests of investors in securities and to promote the development of, and to regulate the securities markets and shall come into force with effect from 1 October 2012," SEBI said.
 

User

RBI revises criteria for declaring dividend by UCBs

Urban cooperative banks which have less than 5% of NPAs and comply with capital to risk-weighted assets ratio norms may declare dividends without prior permission from the central bank

 

Mumbai: The Reserve Bank of India (RBI) said urban cooperative banks (UCBs) which have less than 5% of non-performing assets (NPAs) and comply with capital to risk-weighted assets ratio norms may declare dividends without its prior permission, reports PTI.

"It has now been decided to revise the criteria for declaring dividend without prior permission of the Reserve Bank," RBI said in a notification.

Further, it said the UCBs should have made all required provisions for NPAs, investments and others assets as per prudential norms.

The dividend should be paid out of the net profit and after making all statutory and other provisions and adjustment for accumulated losses in full, it said.

"UCBs complying with all the above parameters except net NPA and desirous of declaring dividend may approach the respective regional office of the RBI for permission for declaring dividend provided the net NPA is less than 10%," it added further.

Earlier, there was a requirement of net NPA of less than 10% for declaring dividend.

User

Corporates given one more year to pre-pay foreign loans

With rupee losing about 25% in the last one year and increasing redemption costs, several companies with FCCBs on their balance sheets are keen to retire these loans

 

Mumbai: The Reserve Bank of India (RBI) has extended the scheme for corporates to get rid of their overseas loans by pre-paying them as weak rupee increases their debt obligation, reports PTI.

The pre-payment of foreign currency convertible bonds (FCCBs) "shall come into force with immediate effect and the entire process of buyback shall be completed before 31 March 2013 after which the scheme lapses," an RBI circular said.

With rupee losing about 25% in the last one year, the redemption costs of overseas loans availed by Indian corporates has increased significantly.

Under these circumstances, several companies with FCCBs on their balance sheets are keen to retire these loans.

For example, Suzlon and Educomp are amongst the ones who are under the process of retiring their FCCB obligations.

Last month, drug firm Strides Arcolab had redeemed outstanding foreign currency bonds worth $80 million.

"On a review, it has been decided to continue the scheme of buyback of FCCBs subject to certain modifications," it said.

Indian firms can now buyback the FCCBs at a minimum discount of 5% on the book value utilising their foreign currency funds under the automatic route, as against 8% earlier, it said.

In case the Indian company is planning to raise a foreign currency borrowing for buyback of the older FCCBs, all foreign exchange regulations relating to foreign currency borrowing should be complied with, it added.

The extension of the window allows greater freedom and leeway to Indian companies. FCCBs witnessed a huge surge during 2006-07. However, the global economic meltdown on 2008-09 impacted most of the companies.

Recently, rating agency Standard & Poor's said that 56 Indian companies, which have to pay back $5 billion worth of foreign debt this calendar year, could see their interest burden going up by $700 million if they chose to reschedule these obligations.

These companies had issued these FCCBs between 2006 and 2008 (and mostly in 2007), before the Lehman fall when the stock prices where at record high, and the rupee was trading at 48 to the dollar.

Most of these bonds are denominated in the US dollar and hence the mounting worries.

The report said the recent rupee fall has added to the woes. Most of the FCCBs that mature in 2012 were issued in 2007-08, when the rupee was at about 42 to a dollar. The rupee has lost more than 30% against the American currency since then.

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)