I-Sec, Lloyds Fin Set To Join Bse Debt Market

However, the plan to set up the debt market segment might run into rough weather if the Reserve Bank of India (RBI) does not lift the ban on BSE brokers' undertaking inter bank deals. Most trading in the debt market is done by banks, and that too, in government securities.

According to sources, BSE brokers are planning to approach the central bank to lift the ban. However, brokers, who hold both the NSE broker's card as well as the BSE card, take part in inter bank deals.

Bankers said that BSE brokers are not allowed to trade on their behalf as the RBI does not permit them to do so. A prominent broker approached us to get themselves empanelled once they start their dealing operations in the BSE debt market segment. However we told them that we cannot route our trades through them as the RBI does not allow us to, said a banker.

 

Inter bank deals form the bulk on the wholesale debt market segment of the NSE. There is no use in dealing on the BSE debt market if brokers are not allowed to take part in inter bank deals, a broker said.

Meanwhile, I-Sec managing director, Kishore Chaukar said that I-Sec is planning to take part in the BSE debt market in a big way once it becomes operational. We already hold the NSE and BSE cards, so we will start operations as soon as things fall into place, Chaukar said.

Shekhar Sathe, senior vice-president in Kotak Mahindra, said that once the debt market develops we will go for it. Sathe added that Kotak holds the BSE and NSE cards. He has, however, ruled out the possiblity of a major shift in trading from the NSE to the BSE.

Senior officials in DSP Financial, which is one of the most active players in the debt market, said that they will enter the BSE debt market once the market becomes active. We are active in the debt segment and we would definitely like to do business on the BSE segement, an official in DSP Financial said.

Lloyds Finance is also planning to start debt market trading on the BSE. A senior official said, We are seeing what are the requirements before we enter the debt market operations.

BSE authorities have firmed up plans where around 700 securities will be listed. Government securities, PSU bonds and non-convertible debentures would be listed under the Fgroup. Initially the debentures and the PSU bonds will be listed and the government securities will be listed after six months said brokers.

Dealers on the NSE wholesale debt market segment said that they will have to get used to BOLT. At present, we are striking all deals on the telephone rather than on the screen. We have to get used to the settlement system on the BSE. The NSE follows a very systematic settllement system and the proposed one on the BSE is different and we have to get used to, a dealer, who holds both the BSE and NSE cards, said.