Cse Imposes Uniform Deposit Rule For Brokers Under Cstar

The Calcutta Stock Exchange (CSE) has decided to cancel the option for its brokers of trading only in non-specified shares. When all shares of the specified group go on-line after April 4, all brokers will have to deposit the amount fixed by the exchange to keep the provision of trading in both A and B-group shares.

Earlier, the brokers trading only in non-specified shares had to pay Rs 8.5 lakh to the exchange as capital adequacy whereas the brokers trading in both specified and non-specified had to pay Rs 10.5 lakh. Since the on-line system (Cstar) will not have any distinction between these two categories of brokers, all brokers will have to deposit Rs 10.5 lakh with the exchange.

 

This means the brokers trading only in non-specified shares will have to submit an additional amount of Rs 2 lakh to the exchange before April 4.

The exchange, at its board meeting on February 21, has also decided to give more powers to various sub-committees so that the board can concentrate on policy matters. The sub-committee in charge of admission of new members and assistants are given wide-ranging powers, which earlier rested with the exchange's board. The sub-committee is now empowered to transfer the membership card of a member to another individual member or to a corporate member. It is also authorised to issue duplicate share certificates and refund security deposits if members decide not to trade in CSE any more. The sub-committee is also empowered to approve the appointment of assistants subject to the fulfillment of existing formalities.

All these decisions were previously taken by the board with recommendations from the sub-committee. Now the decisions will be taken by the sub-committee and the board will only be informed on the decisions taken.

The exchange has also empowered the powers of the 'finance sub-committee'. From now onwards, quotations will have to be invited for all orders or works costing more than Rs 50,000. Besides, the approval from the finance sub-committee. The board will approve orders of more than Rs 1 lakh with recommendations from the sub-committee. The CSE president, however, will have the powers to sanction the orders which will later will be ratified by the board. This has been done in a view to expedite matters.

The finance sub-committee will also approve the manner in which the funds of the exchange are invested and inform the board of the same. The powers of the finance sub-committee in sanctioning of funds, too, has been increased with the ceiling being raised from Rs 15,000 to Rs 2.5 lakh.

The secretary's powers to sanction funds has also been enhanced with the maximum being raised from Rs 1,000 to Rs 20,000. From now onwards appointments up to the junior executive level will be approved by the finance sub-committee whereas senior level appointments will have to be placed before the full board for approval.