Sebi has decided to enhance the minimum net worth requirement for portfolio managers. The regulator has also approved the draft Sebi (Issue and listing of Debt Securities) regulations 2008.
Sebi said in a statement that the board, in a meeting held on Tuesday, decided to enhance the minimum networth requirement for registration as portfolio manager from the existing Rs 50 lakh to Rs 2 crore. It has been decided to give effect to the requirement of maintaining continuous networth separately for portfolio management activities.
“The existing portfolio managers, whose net worth is less than Rs 2 crore will have to increase it to at least Rs one crore within a period of six months and thereafter to the prescribed net worth of Rs 2 crore in the next six months from the date of notification of amendment to the Sebi (portfolio managers) regulations, 1993,” the regulator said.
Sebi said that it was also decided that the portfolio managers should not float a scheme or pool the resources of the client in a way, which is akin to mutual fund (MF) activity. Accordingly, portfolio managers will not be permitted to float a scheme or pool the resources of the clients. They would be required to keep assets of each client separately and not in a pooled manner. A time frame of six months from the date of notification has been given to convert their operations managed on pooled basis to individual basis. The necessary amendments would be made to the regulations, the regulator said.
The Sebi board has decided to issue a final notification on Sebi (Issue and listing of debt securities) regulations, 2008. The regulator has approved the draft Sebi (Issue and Listing of Debt Securities) in a meeting held on January 30, 2008. The board approved certain amendments to the draft regulations after taking into consideration the public comments it has received.
