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  1. SEBI: ‘Portfolio managers can keep client funds in separate a/c’

SEBI: ‘Portfolio managers can keep client funds in separate a/c’

While giving an informal guidance in this regard, Sebi also said that portfolio managers have to comply with the relevant regulations.

By: | New Delhi | Published: February 2, 2017 3:12 PM
An application was filed by Karvy Stock Broking Ltd which sought an informal guidance from the markets regulator on whether a separate bank account opened by it for pooling the funds of the clients is in order or not. (Source: IE) An application was filed by Karvy Stock Broking Ltd which sought an informal guidance from the markets regulator on whether a separate bank account opened by it for pooling the funds of the clients is in order or not. (Source: IE)

A portfolio manager can keep funds of all clients in a separate pooled bank account and can show the same in the demat details of resident Indian clients, according to Sebi.

While giving an informal guidance in this regard, Sebi also said that portfolio managers have to comply with the relevant regulations.

An application was filed by Karvy Stock Broking Ltd which sought an informal guidance from the markets regulator on whether a separate bank account opened by it for pooling the funds of the clients is in order or not.

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“A portfolio manager can keep the funds of all clients in a separate bank account maintained by it and may capture the same in the demat account of its resident Indian clients, subject to compliance with… Portfolio Managers Regulations,” the regulator said in a recent communication.

Further, the watchdog said the response is based on the representation made by the company and different facts or conditions might lead to a different result.

The views are expressed with respect to clarification sought in terms of PM regulations and is not applicable for any other Sebi regulations, it added.

As per a circular issued by the regulator in June 2009, portfolio managers may keep the funds of all clients in a separate bank account maintained by it subject to various conditions including a clear segregation of each client’s fund through proper and clear maintenance of back office records.

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