Latest news with #MIIs
Economic Times
26-05-2025
- Business
- Economic Times
Sebi comes out with appointment process of senior officials at MIIs
Markets regulator Sebi on Monday came out with a process to appoint specific key officials of stock exchanges and other market institutions. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Markets regulator Sebi on Monday came out with a process to appoint specific key officials of stock exchanges and other market institutions. These measures are aimed at ensuring that MIIs ( market infrastructure institutions ) are staffed with qualified, independent key management personnel (KMPs) and directors while safeguarding market integrity through effective cooling-off policies."To strengthen the governance framework of stock exchanges, clearing corporations and depositories (collectively referred to as MIIs), it is required that the KMPs of MIIs in the crucial areas of operations, such as compliance, risk management, technology and information security are of appropriate stature and independence," Sebi said in its Sebi came out with a process for the appointment, re-appointment, termination or resignation of Key Management Personnel like the Compliance Officer, Chief Risk Officer, Chief Technology Officer and Chief Information Security the appointment process, Sebi said an external agency will identify suitable Nomination and Remuneration Committee (NRC) will review and recommend to the Governing Board of MIIs. Further, the Governing Board will make the final regards to re-appointment, termination, or resignation, Sebi said NRC will evaluate and recommend action to the Governing Board and the final decision rests with the the regulator said that KMPs should be given a fair hearing before termination."While the Governing Board of the MII sets the overall tone, a culture of prioritising efficient discharge of responsibilities towards public interest falling under Verticals 1 and 2, over commercial interest under Vertical 3 must be ingrained at the operating level as well."Along with having a capable and efficient Managing Director (MD), there is a need for KMPs of appropriate stature and ability in Vertical 1 and 2 to ensure that the MII delivers its primary mandate as a public utility infrastructure institution and a first-line regulator," Sebi the cooling-off period for KMPs moving to competitor MIIs, Sebi said that Governing Boards will decide on cooling-off periods for KMPs (including MDs) before they can join a competing regulator said that cooling-off rules for Public Interest Directors (PIDs) and Non-Independent Directors have been updated through Gazette notifications (effective 90 days after April 30, 2025).Additionally, Sebi also reviewed the process for re-appointing Public Interest Directors on the governing board of MIIs."It has been decided that in case the existing PID after completion of his first term is not considered for re-appointment by the Governing Board of the MII, the rationale for the same shall be recorded and informed to Sebi," the regulator provisions will be applicable from the 90th day from this Monday, the regulator said.
Time of India
26-05-2025
- Business
- Time of India
Sebi comes out with appointment process of senior officials at MIIs
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Markets regulator Sebi on Monday came out with a process to appoint specific key officials of stock exchanges and other market institutions. These measures are aimed at ensuring that MIIs ( market infrastructure institutions ) are staffed with qualified, independent key management personnel (KMPs) and directors while safeguarding market integrity through effective cooling-off policies."To strengthen the governance framework of stock exchanges, clearing corporations and depositories (collectively referred to as MIIs), it is required that the KMPs of MIIs in the crucial areas of operations, such as compliance, risk management, technology and information security are of appropriate stature and independence," Sebi said in its Sebi came out with a process for the appointment, re-appointment, termination or resignation of Key Management Personnel like the Compliance Officer, Chief Risk Officer, Chief Technology Officer and Chief Information Security the appointment process, Sebi said an external agency will identify suitable Nomination and Remuneration Committee (NRC) will review and recommend to the Governing Board of MIIs. Further, the Governing Board will make the final regards to re-appointment, termination, or resignation, Sebi said NRC will evaluate and recommend action to the Governing Board and the final decision rests with the the regulator said that KMPs should be given a fair hearing before termination."While the Governing Board of the MII sets the overall tone, a culture of prioritising efficient discharge of responsibilities towards public interest falling under Verticals 1 and 2, over commercial interest under Vertical 3 must be ingrained at the operating level as well."Along with having a capable and efficient Managing Director (MD), there is a need for KMPs of appropriate stature and ability in Vertical 1 and 2 to ensure that the MII delivers its primary mandate as a public utility infrastructure institution and a first-line regulator," Sebi the cooling-off period for KMPs moving to competitor MIIs, Sebi said that Governing Boards will decide on cooling-off periods for KMPs (including MDs) before they can join a competing regulator said that cooling-off rules for Public Interest Directors (PIDs) and Non-Independent Directors have been updated through Gazette notifications (effective 90 days after April 30, 2025).Additionally, Sebi also reviewed the process for re-appointing Public Interest Directors on the governing board of MIIs."It has been decided that in case the existing PID after completion of his first term is not considered for re-appointment by the Governing Board of the MII, the rationale for the same shall be recorded and informed to Sebi," the regulator provisions will be applicable from the 90th day from this Monday, the regulator said.
Time of India
23-05-2025
- Business
- Time of India
What's causing profit decline in major broking firms?
Mumbai: The profitability of most large listed broking firms took a severe beating in the March quarter, weighed down by a slew of stricter regulations, scrapping of some popular derivative products and lower trading activity in the wake of the stock market decline. For instance, Angel One recorded a 40% decline in its standalone profit and a 17% drop in standalone revenue in the fourth quarter as against the December quarter. Motilal Oswal Financial Services posted a loss of over ₹8 crore on a standalone basis in Q4. Standalone profits of other listed brokers such as IIFL Capital Services , 5paisa Capital and Choice International also fell 35-61% in the March quarter compared to October-December. The drop in profits and revenues during the quarter is an outcome of some of the steps taken by the Securities and Exchange Board of India (Sebi) to curb the excessive speculation by retail traders in futures and options over the last three years. The regulator's decision asking exchanges to provide derivatives contracts for only one of its benchmark indices with weekly expiry in November forced bourses to scrap some of their highly traded index options. "We've seen a dip primarily due to Sebi's regulatory changes like increasing lot sizes and reducing the number of weekly expiries," said Gagan Singla, managing director at BlinkX by JM Financial. "These moves, while well-intentioned, have impacted retail participation and strategy rotations, especially in index options. Add to that a spike in transaction costs like STT, and naturally, trading activity, especially from retail, really took a hit." The average daily turnover on NSE in the cash market declined by almost 19% from September 2024 to March 2025, while equity derivatives' turnover on the NSE declined by 27% in this period, as per NSE data. Agencies Sebi's 'uniform fee structure' and 'true-to-label' norms announced in July last year also squeezed brokerages' profits. The uniform fee structure requires market infrastructure institutions (MIIs) such as exchanges to collect the same charges from all brokers. Till then, brokers got discounts on basis of volumes generated. The true-to-label norms require brokers to pass on to MIIs the exact charges they collected from clients. Earlier, brokers would collect full charges from clients but would only pass on a part of it to exchanges. "There have been multiple structural changes undertaken by Sebi like introduction of the 'true-to-label' norms, crackdown on influencers and discontinuation of many weekly derivatives contracts, which have hurt the income of brokers," said Ajay Kejriwal, executive director at Choice Equity Broking. Among stock exchanges, BSE's consolidated net profit in March quarter shot up 126% from previous quarter, whereas NSE's profit fell 31%. Kejriwal said BSE did well as traders moved to Sensex weekly options after the discontinuation of multiple weekly derivatives contracts such as Nifty Bank index. Shares of Motilal Oswal, Angel One, IIFL Capital, and 5paisa are down 4-20% in 2025. BSE shares have gained 29% in 2025 so far. For the broking business to recover, equities must either rebound or firms must increase costs. "Since most changes are permanent, brokers are expected to see weakness until market recovers significantly, or if they take large price hikes, and Q1 results may not be positive," said Kejriwal. The times of supernormal growth might be over for now. "We wouldn't call this the new normal, but more of a recalibration," said Singla. "Volumes are down from the peaks, but they're still multiple times higher than five years ago. What's likely from here is more linear, sustainable growth, not the explosive spikes we saw post-Covid."
Economic Times
22-05-2025
- Business
- Economic Times
Why is Groww raising brokerage fees by 150% for small trades?
The new rules allow brokers to levy transaction charges on clients that they would pay the Market Infrastructure Institutions (MIIs) - stock exchanges, clearing corporations, and depositories. Synopsis Groww, a major Indian brokerage firm, will increase its minimum equity brokerage charges. The increase is from ₹2 to ₹5 per order. This change impacts smaller equity trades. The new fee structure will be effective from June 21. Other brokers like Angel One previously raised their fees. These changes follow regulations impacting brokerage profits. Mumbai: Groww, India's largest broker in active clients, is set to increase its fees by 150% for low-ticket transactions as the profitability of discount broking firms has come under pressure in the face of tighter regulations. ADVERTISEMENT The firm, in a communication to clients, said it will hike the minimum equity brokerage charges to ₹5 per order from ₹2, for equity trades from June 21. The move is expected to increase the trading costs of smaller transactions. The IPO-bound firm with about 13 million active clients will charge brokerage fees in the range of ₹5 to ₹20 per trade against ₹2 to ₹20, currently. Other larger brokers, like Angel One, also had increased their brokerage charges from 0 to ₹20 on equity trades late last year, after the Securities and Exchange Board of India's 'true-to-label' norms announced in July last year squeezed brokerages' profits. The new rules allow brokers to levy transaction charges on clients that they would pay the Market Infrastructure Institutions (MIIs) - stock exchanges, clearing corporations, and depositories. This has eliminated the hidden markup, which has hit brokers' profitability. 'Following the regulatory changes introduced last year, we've seen a notable decline in derivative volumes across Indian markets, which has had a significant impact on broker revenues,' said Ashish Nanda, President and Digital Business Head at Kotak Securities. 'Sebi's 'True to Label' circular further removed the rebates that previously contributed 10 to 50% of brokers' income.' Equity derivatives turnover on NSE declined 27% to Rs 39.5 lakh crore in March from Rs 54.4 lakh crore in September, according to NSE. Nanda said due to these pressures, many firms have resorted to price hikes as a way to offset the financial hit. After the regulatory tightening, Zerodha founder Nithin Kamath said on X: 'With the new circular, we will, in all likelihood, have to let go of the zero brokerage structure and/or increase brokerage for F&O trades. Brokers across the industry will also have to tweak their pricing.' Groww also revised the interest rates for the MTF (Margin Trading Facility) — a system that allows investors to borrow to buy shares they cannot afford —at 14.95% per annum. Currently, the broking firm charges 15.75% per annum as MTF interest for funding amounts less than Rs 25 lakh and 9.75% for Rs 25 lakh and above. ADVERTISEMENT This decision will make it more expensive for the high-volume users of the MTF facility. Groww said the Depository Participant (DP) charges for clients will also go up from Rs 18.5 per day per stock (irrespective of the number of sale transactions in a stock) to Rs 20 per sale transaction 'Earlier, you were charged DP charges once per stock (ISIN) per day,' said the firm in the client communication. 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Time of India
20-05-2025
- Business
- Time of India
Sebi revised norms: Sebi updates audit committee norms for MIIs
Mumbai: The Securities and Exchange Board of India (Sebi) on Monday revised norms on the composition of audit committee and internal audit mechanism at market infrastructure institutions (MIIs).The regulator said the audit committee of the MII should not have any executive director including the managing director. The auditors of the MII and the key management personnel (KMP) would have a right to be heard in the meetings of the audit committee when it considers the auditors's report but would not have the right to vote, it said . Further, whenever required, the KMPs could be invited to attend the audit committee meetings with the permission of the chair but would not have the right to vote."The terms of reference of the audit committee amongst others involves approval of related-party transactions, scrutiny of financial statements, evaluation of internal financial controls and risk management systems, etc which requires objective evaluation of the functioning and decisions of the management," Sebi also said MIIs should conduct internal audit of functions and activities at least once in a financial year. Besides, internal auditor should be an independent audit firm and report only to the audit committee.
