Sebi settles Axis Bank-United India Insurance case

The matter pertained to alleged lapses in disclosures with respect to change in promoter United India Insurance's shareholding in the private lender.

Axis Bank and its promoter United India Insurance Company have settled with regulator Sebi cases of alleged disclosure lapses and have paid more than Rs 51.5 lakh as total settlement amount.

The matter pertained to alleged lapses in disclosures with respect to change in promoter's shareholding in the private lender. The entities were alleged to have violated Prohibition of Insider Trading (PIT) norms, as per two separate settlement orders passed on Monday.

An investigation by Sebi found that during October 1, 2017 to September 30, 2018 period, the value of trades by United India Insurance Company in the securities of Axis Bank on each trading day was more than Rs 10 lakh.

The promoter was required to make disclosures about such transactions to the private lender within two working days as required under PIT norms.
 

However, in five instances, the said disclosures were made by United India Insurance Company to the lender with a delay of 10-17 days, Sebi noted.

Besides, Axis Bank was required to disclose the same to the stock exchanges within two trading days of the receipt of the disclosure from the promoter.

"However, the same was disclosed by the applicant to the stock exchange only on October 16, 2020, only with a delay of 1,072 -1,080 days," Sebi said.

In December 2020, the regulator had issued notices of summary settlement to the entities, intimating that the proceedings may be settled on filing of settlement applications and remittance of settlement amounts of Rs 41,43,750 by Axis Bank and Rs 10,13,906 by United India Insurance Company.

Accordingly, the entities filed settlement applications with the regulator proposing "to settle without admitting or denying the findings of fact and conclusions of law."

The entities remitted their respective settlement charges on January 27, 2021.