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Economy Current Affairs
Economy Current Affairs March 5th Week 2018
Author : Admin
Category : Economy Current Affairs
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Economy Current Affairs March 5th Week 2018

 1. SEBI Allows Physical Settlement Of Stock Derivatives.

The stock market regulator Securities & Exchange Board of India (Sebi) has allowed physical settlement of both stock options and stock futures. At present only cash settlement of derivatives is allowed. Sebi said stock exchanges will also have flexibility to offer a combination of cash settlement for stock options and physical settlement for stock or physical settlement for stock options and cash settlement for stock futures.

A stock exchange may introduce physical settlement in a phased manner, it said in a circular. On introduction, however, physical settlement for all stock options and/or all stock futures, as the case may be, must be completed within six months, Sebi said. The settlement mechanism shall be decided by the stock exchanges in consultation with the depositories, the stock market regulator said.

On expiry/exercise of physically settled stock derivatives, the risk management framework (i.e. margins and default) of the cash segment shall be applicable, it said. Settlement of cash and equity derivative segments will continue to remain separate, the Sebi circular said.

 The stock exchanges interested in introducing physical settlement are advised to submit to Sebi for approval, a detailed framework for implementation of physical settlement of stock derivatives. After opting for a particular mode of settlement for stock derivatives, a stock exchange may change to another mode of settlement after seeking prior approval of Sebi, it said.

 

2. Reserve Bank of India Imposes Rs 58.9 Cr Penalty On ICICI Bank.

The Reserve Bank of India (RBI) has imposed a monetary penalty of ?58.9 crore on ICICI Bank Ltd for non-compliance with the directions issued by RBI on direct sale of securities from its Held To Maturity (HTM) portfolio and specified disclosure in this regard.

The central bank, in a statement, said this penalty has been imposed in exercise of powers vested in RBI under the provisions of the Banking Regulation Act, 1949, taking into account failure of the bank to adhere to its directions/guidelines.

"This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers," RBI said.

Meanwhile, ICICI Bank, in a statement, said RBI has imposed a penalty on the bank for continued sale of government securities classified as HTM.

"ICICI Bank had continued with the sales from HTM category for a few weeks during the quarter ended March 31, 2017, due to a genuine misunderstanding on the timing of the applicability of RBI’s direction in this matter.

"As per RBI guidelines, the bank had disclosed in its annual report for FY2017 that it had sold more than 5 per cent of investments categorised as HTM," the private sector bank said.

However, the bank said it had not made the specified additional disclosure at that time. The bank added that it has subsequently been making the specified disclosure as directed by RBI in the audited financial results since the quarter ended June 30, 2017.

During the current year (FY2018), the bank has sold less than 5 per cent of securities from its HTM portfolio, according to the statement.

The bank emphasised that it continues to give utmost importance to regulatory compliance and endeavours to meet supervisory expectations.

3. Union Cabinet Approves Rs 4,500 Crore To Boost Development Projects In North-East.

The Union Cabinet today approved Schemes of North Eastern Council (NEC) including continuation of existing Schemes. It will boost the development projects in North-East.

Four thousand 500 crore rupees have been approved for the scheme for three years upto March, 2020.

The Scheme of NEC – Special Development Project will be changed to be a Central Sector Scheme with 100 per cent grant.

Minister of Development of North Eastern Region, Dr Jitendra Singh told media that the government is committed for the development of the region and the hard work and dedication of the Prime Minister Narendra Modi towards North East has started showing results.

Besides, NEC is also implementing North Eastern Road Sector Development Scheme – Programme Component for upgradation of the important and strategic inter-state roads.


 

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