Media Release
Clarification on Margin Funding
There is a report in media stating that a regulatory circular supposedly issued in October 2024 expelled 1,010 stocks, effective November 2024, from the list of 'collaterals' acceptable as margin pledges for availing Margin Trading Facility (MTF) from clearing corporations.
This is factually incorrect. No such circular was issued by SEBI in October, and no large-scale changes have been made recently to the list of securities on which MTF can be offered.
As per the current Regulatory framework, MTF is provided by Trading Members (TMs) to their clients, in Stocks and Exchange Traded Funds that are part of Group I list of securities issued by Clearing Corporations. The list of Group I securities is computed based on objective criteria of impact cost and same is updated every month and published by Exchanges’ on their websites. As per this, currently around 2,000 securities form part of Group I.
Contrary to the article’s claim, there has been no reduction in the number of securities eligible for MTF. Further, acceptance of collaterals by Clearing Corporation is based on Risk based objective approach to manage the efficiency of risk management and clearing and settlement. There is no scrip specific discrimination that is exercised while updating the list of acceptable collaterals on periodic basis.
Note that lending under MTF went up in October 2024 to all-time record high level of over INR 80,500 crores.
This press release is being issued by both the Exchanges -- NSE and BSE -- to clarify and correct this report.
About BSE
BSE, India’s leading exchange group is celebrating its 150th year anniversary. BSE has been playing a prominent role in developing the Indian capital market. BSE is a corporatized and demutualized entity, with a broad shareholder base. BSE provides an efficient and transparent market for trading in equity, debt instruments, equity derivatives, currency derivatives, interest rate derivatives, mutual funds, stock lending and borrowing. For more information, please visit: www.bseindia.com
Media Contact
Santanu Chakraborty
022 2272 8516
Santanu.Chakraborty@bseindia.com
About National Stock Exchange of India Ltd. (NSE)
National Stock Exchange of India (NSE) is the world’s largest derivatives exchange by trading volume (contracts) as per the statistics maintained by Futures Industry Association (FIA) for calendar year 2023. NSE is ranked 3rd in the world in the cash equities by number of trades as per the statistics maintained by the World Federation of Exchanges (WFE) for calendar year 2023. NSE was the first exchange in India to implement electronic or screen-based trading. It began operations in 1994 and is ranked as the largest stock exchange in India in terms of total and average daily turnover for equity shares every year since 1995, based on SEBI data. NSE has a fully integrated business model comprising exchange listings, trading services, clearing and settlement services, indices, market data feeds, technology solutions and financial education offerings. NSE also oversees compliance by trading, clearing members and listed companies with the rules and regulations of SEBI and the exchange. NSE is a pioneer in technology and ensures the reliability and performance of its systems through a culture of innovation and investment in technology.
For more information, please visit: www.nseindia.com
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Email ID: cc@nse.co.in