Capital markets regulator Sebi has amended norms associated to safety cowl, disclosure of credit score scores and due diligence certificates for unsecured debt securities.
Sebi has revised guidelines pertaining to debenture trustee norms, aside from situation and itemizing of non-convertible securities norms and LODR (Listing Obligations and Disclosure Requirements) guidelines, in accordance with three separate notifications issued on Monday.
Sebi board had already accepted proposals on this regard in February.
The regulator has altered guidelines to align the framework and terminology with respect to ‘security cover’ whereby the time period ‘asset cover’ has been substituted with time period ‘security cover’ in debenture trustee guidelines and LODR norms.
In addition, the regulator has redrafted guidelines prescribing the upkeep of safety cowl enough to discharge each principal and curiosity thereon.
Further, the regulator has rationalised the disclosure requirement with regard to credit score scores and put in place the requirement of a due diligence certificates for unsecured debt securities within the (Issue and Listing of Non-Convertible Securities) guidelines.
Rationalising the requirement, Sebi mentioned disclosure pertaining to particulars of credit standing together with the newest press launch of the credit standing company in relation to the difficulty and declaration that the ranking is legitimate as on the date of issuance and itemizing have to be made within the prospectus.
It additional mentioned that such press releases shouldn’t be older than one yr from the date of opening of the difficulty.
Earlier, disclosures have been required with regard to particulars of credit standing alongside on the subject of the ranking letter issued (not older than one month on the date of opening of the difficulty) by the ranking companies in relation to the difficulty.
Under the brand new guidelines associated to non-convertible securities, Sebi mentioned the issuer should make sure that the debt securities are secured by 100 per cent safety cowl or increased safety cowl as per the phrases of the provide doc and/or debenture belief deed enough to discharge the principal quantity and the curiosity thereon always for the issued debt securities.
Source: www.financialexpress.com”