Markets regulator Sebi has issued a consultation paper on the treatment of interest income earned by the clearing corporations from cash collaterals from clearing members and upstreamed client funds.
Sebi had previously mandated the upstreaming of all client funds to Clearing Corporations (CCs) at the end of the day, allowing these funds to be upstreamed only in the form of cash, fixed deposit liens, or mutual fund overnight scheme pledges.
In its consultation paper, the regulator noted that clearing corporations have been holding substantial cash collaterals from Clearing members (CMs) towards settlement obligations and margin money, investing or deploying these funds to earn interest or income.
Copyright © 2017 Indian Grapevine a unit of Integrated Media Enterprises
