SEBI makes changes to the Corporate Bonds/ Debentures Centralized Database.
SEBI obliged Depositories to jointly establish, host, and maintain a Centralized Database of corporate bonds held in Demat form in a circular dated October 22, 2013, titled “Centralized Database for Corporate Bonds/ Debentures.” After conversations with market players, it was agreed to further simplify the database and make information more accessible to investors. It is requested that the above-mentioned circular be replaced and that an updated list of data fields be preserved in the database, and the way in which they should be filed, be provided.
The consolidated database of corporate bonds will continue to be created, hosted, maintained, and disseminated by the Depository. The Depositories will continue to host all historical data in the database in accordance with the SEBI Circular of October 22, 2013.
- Depositories must guarantee that they have suitable procedures and protections in place to protect data integrity and prevent data modification. In collaboration with the other Depository, each Depository must synchronize the database. Within three working days of receiving information from an issuer, the Depository which receives it must host it as well as share it with the other Depository for hosting.
- Upon conversations with market players, it was agreed to further simplify the database and make information more accessible to investors. It is requested that the above-mentioned circular be replaced and that an updated list of data fields to be retained in the database be provided.
- Stock exchanges and depository institutions must design a system that updates information on a daily basis. The circular’s Annex I and II include listing data that must be verified by stock exchanges. When received from Issuers in Annex II, Stock Exchanges must update event-based and periodic information in the Centralized Database.
- Credit Rating Agencies will have access to the database to validate the Issuer’s rating information. Credit Rating Agencies must notify Stock Exchanges of any discrepancies and update the proper information in the database within the period specified in Annex – III.
- Debenture Trustees must access the database to check default history and other relevant data. In the event of a discrepancy, the Debenture Trustee must notify the Stock Exchanges and update the database with the right information within the period specified in Annex III.
- Depositories must additionally submit information on Redeemable Preference Shares and Securitized Debt Instruments in a separate part of the database, in the form that they have available, after sharing it with the other depository for database sync and updating.
- This circular will apply to debt securities that are issued on or after August 1, 2021.
Individuals and small businesses experiencing Covid-19-related stress can be reduced by revising the aggregate exposure threshold.
The circular dated May 5, 2021, on “Resolution Framework – 2.0: Resolution of Covid-19 related stress of individuals and small businesses,” is referred to. The appropriate borrowers who may be considered for resolution under the framework are listed in clause 5 of the abovementioned circular, which contains the following sub-clauses:
- Individuals who have taken out business loans and advances and to whom lending institutions have a total exposure of fewer than 25 crores as of March 31, 2021.
- Small enterprises, including those in retail and wholesale trade, that are not designated as MSME as of March 31, 2021, and to which lending institutions have a total exposure of fewer than 25 crores as of March 31, 2021.
- Results from a study, it was agreed to increase the aforesaid limitations from 25 to 50 crores.