Sebi approves regulatory framework for private equity funds to sponsor mutual funds

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Sebi approves regulatory framework for private equity funds to sponsor mutual funds

On Wednesday, capital markets regulator Sebi approved a regulatory framework to allow private equity funds to sponsor mutual funds.

This decision comes in the wake of the acquisition of IDFC Mutual Fund by a consortium consisting Bandhan Financial Holdings Ltd, Sovereign Wealth Fund GIC and private equity fund ChrysCapital.

Any entity that has a 40 per cent stake in a mutual fund is considered a sponsor and must meet eligibility criteria to be considered a sponsor.

Under the alternative eligibility criteria for sponsor of MF, Sebi proposed that sponsors should capitalise the AMC such that the positive liquid net worth of AMC should be at least 150 crore.

The Securities and Exchange Board of India chief said that the regulators will strengthen corporate governance norms and have decided to end the practice of individuals having permanent seats on boards of listed companies.

On Wednesday, the Securities and Exchange Board of India chief Madhabi Puri Buch refused to comment on the Adani-HindenburgAdani-Hindenburg row.

The regulator doesn't have a comment on individual companies. She said that we will follow the advice of the Supreme Court in the case of Adani.

One of the issues Sebi has been looking into is the spirit of law and the letter of law. Buch said that the regulators need to do something about the board meeting and that we want to take this forward in the coming year.