The list includes big names like DSP Financial Consultants, Hongkong Bank, IFCI and about 90 others.
Said a senior Sebi official: Of the 38 to 40 applications which were filed late, most of them have some excuse or the other for the delay.
Therefore, this time, we will be lenient and will not cancel the registration. However, this should serve as a warning and put them on the alert, he added.
A show-cause notice was issued to all these merchant bankers asking them why their licences should not be cancelled as they had violated the Sebi regulations. The regulator is not amused with the manner in which top-notch merchant bankers have been taking their registration renewals lightly and asking for renewals at the last minute, the official added .
Merchant bankers are supposed to renew their applications three months before the licence expires. We have alerted the Association of Merchant Bankers of India on the issue. It will soon be issuing a circular to its members, the source informed. Sources at Sebi also hinted that Ambi has been asked to ensure that its members are particular about all these formalities.
The sources felt that the role of self-regulatory organisation needs to be broadened and more discipline ensured.
Sebi has also decided to inspect top merchant bankers at random to check for due diligence violations. With Sebi giving up vetting of offer documents some merchant bankers have not strictly adhered to the due diligence norms. It is felt that the merchant bankers should check out the projects and pronouncements made in the prospectuses in detail as part of their responsibilities.
