18 Pune Bourse Brokers Face Expulsion

The exchange had suspended the 18 brokers, who failed to meet the Securities and Exchange Board of India (Sebi) guidelines, from August 1.

Earlier, the bourse had suspended 21 brokers from trading as they had failed to meet the June 30 deadline. Of the 21 brokers, only three brought in the additional capital of Rs 2 lakh. The others, who were citing acute cash crunch as the reason for their failure to meet the deadline, had ceased trading since the PSE trading went on-line in March 1996.

PSE executive director P L Kadlaskar said, we have given them sufficient time of three months up to November 30 to meet the capital adequacy norms failing which they will face expulsion and loss of PSE membership. The brokers have the option of bringing in the additional Rs 2 lakh capital (besides the Rs 2 lakh paid earlier); half in cash and the balance in the form of securities, he said.

 

In fact, the 18 suspended brokers have not even been able to occupy the office space provided by the PSE for on-line trading, as it entailed a one-time investment of around Rs 75,000 besides additional costs of office equipment, staff, telephone and electricity bills. Besides, the exchange also levies a minimum of Rs 2,500 per month as service charge.