1. New framework to deepen corp bond market

New framework to deepen corp bond market

Markets regulator Sebi on Wednesday approved a new framework for consolidation and reissuance of debt securities as part of its efforts to deepen the corporate bond market.

By: | Mumbai | Published: April 27, 2017 5:31 AM

Markets regulator Sebi on Wednesday approved a new framework for consolidation and reissuance of debt securities as part of its efforts to deepen the corporate bond market. Liquidity in the secondary market for corporate bonds will be increased by way of limiting the number of ISINs (International Securities Identification Numbers) allocated to a corporate per financial year to 12. This measure will help to increase liquidity in the secondary market, it said in a press release. ISINs are used to number specific securities.

An ISINs code, which is alphanumeric and has 12 characters, is used for uniquely identifying securities such as bonds, stocks, warrants and commercial papers.

“Within the bucket of these 12 ISINs, the issuer can issue both secured and unsecured Non-Convertible Debentures (NCDs)/bonds and no separate category of ISINs may be provided to them,” Sebi said. Additionally, the issuer may issue five ISINs per financial year for structured debt instruments of a

particular category.

The above restrictions will not be applicable on debt instruments which are used for raising regulatory capital such as Tier I, Tier II bonds, bonds for affordable housing and the capital gains tax bonds.

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