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Journalism of Courage
MUMBAI, FEB 8: Central Depository Services Ltd CDSL, promoted by the Bombay Stock Exchange BSE, has finally got the nod from Sebi to kick off operations. The regulator gave the commencement of operation to the second depository in the country on Monday.
To start with, BSE will be the main stake-holder in the depository. The depository has in addition been sponsored by Bank of India, State Bank of India, Bank of Baroda and HDFC Bank.
The depository will be the second after the National Securities Depository Ltd and will have the minimum required equitycapital of Rs 100 crore of which Rs 65 crore has been brought in by BSE.
Following the appointment of former UTI and Sebi chairman SA Dave as the new chairman of the depository, former chairman MG Damani stepped down formally on Monday. The BSE sponsored depository has been a much discussed about project. It was conceived more than three years back by the then BSE president MG Damani. It was aimed at providing a counter to NSDL, which was co-promoted by BSE8217;s arch rival, the National Stock Exchange NSE. NSDL had come into operation in end-1996 and since then the exchange went all out to promote its own depository.
It found trouble in raising the equity of Rs 100 crore and getting tax approvals from the government. Banks were approached to pick up a stake in the venture and a few months back Sebi granted the registration certificate to the depository. Next step was to receive the commencement of operation certificate from Sebi and this could not have been granted till the exchange could not prove thatall the funds had come in.
