RBI, SEBI TO REGULATE NCDs JOINTLY

Non-convertible debentures (NCDs) of less than one- year maturity will now be regulated jointly by financial and market regulators. The decision was taken at a meeting between the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI). The two regulators agreed that NCDs needs to be regulated following huge investments by mutual funds in fixed income plans and banks as it posed a systemic risk in case there was any problem in redemption of these instruments.