Sebi plan to introduce capital adequacy norms rattles stockbrokers

Traders contend norms are stringent, no need for them when regulator has already reduced brokers' dependency on client securities and margin

The Securities and Exchange Board of India's (Sebi) plan to introduce capital adequacy norms is causing further heartburn to brokers. Stockbrokers are already grappling with new guidelines around margin pledging, increase in upfront margin for intra-day trading, and strict penalties for violation of these norms.

Sebi Chairman Ajay Tyagi, while addressing a conference recently, stressed the need for bringing new capital adequacy norms. “There are all types of brokers in the system. The net worth requirement was set almost a decade back. So that area needs reform. We will examine this. Capital adequacy should be the first level of consideration,” he