Bse A Copycat, Says Nse Chief
Patil launched a virtual broadside against BSE, now typical of the two exchanges, making it clear that BSE was only copying the efforts of NSE by upgrading itself in various ways. Patil made these comments during a live chat show on the Internet, hosted by Rediff on the Net.
Patil said the NSE-50 index (Nifty) is the best barometer of the country's capital markets and that BSE has followed a copycat approach in recasting the Sensex.
The Sensex revision is not the only occasion they have followed a copycat approach. Introduction of computerisation, shortening of settlement cycles, sorting of investor complaints, quick auctioning mechanism to resolve failed trades, margin system and so on are the instances where they have tried to imitate us, said Patil.
The NSE chief answered a volley questions, some tame and some others controversial. The queries ranged from the evolution of the NSE to the future plans and the existing market mechanisms, from non-voting shares to the depository. To the question when he can be vocal like BSE president M G Damani, Patil said it was impossible for him to do so.
When asked why he was so soft on the Ambanis, he said: Stock exchanges derive their rights vis-a-vis companies from the listing agreements. They cannot do anything beyond what is contained in the listing agreement. There are other authorities like the Department of Company Affairs, government of India and Sebi, which have real powers when there are any violations in legal and other regulatory areas. NSE would like to adopt a fair approach to all the companies and would like to pretend to have powers which it does have.''
On the steps NSE is taking to win back the investor confidence, Patil said the exchange's approach of focusing on small investors is having a significant impact on the functioning of other bourses. Other exchanges are finding that the small investor is leaving them and flocking to NSE. Competition will mean eventually better service to investors,'' said Patil.
He said NSE is conducting seminars across the country to enlighten investors about their rights vis-a-vis the exchange and the members. Investors should be made fully conscious of their rights, he said.
Patil said he wants NSE to become a