As a corollary to its recently launched business recasting plan, the bourse has successfully shed the flab by retrenching over 26 employees by offering a Voluntary Retirement Scheme. The bourse has also lined up plans to spread its wings to other centres by extending its screen-based trading system, Cochin Online Trading System through Wide Area Networking (WAN).

CSE vice-president Johny John Kannampally and treasurer Sudeesh Shenoy said here on Monday that the extraordinary general body meeting of the exchange held here the other day cleared the management's proposal to float a separate company to take up membership on the NSE and BSE. The EGM resolution came in the wake of the recent decision by the Securities and Exchange Board of India (SEBI) to allow regional stock exchanges to join on larger stock exchanges as members through separate subsidiary route.

The CSE plan spelled out by its vice-president and treasurer came close on the heels of similar decisions by other smaller stock exchanges including Ludhiana and Bangalore stock exchanges.

According to the plans unravelled by the CSE officials, the exchange has floated a separate company, CSE Financial Services which would take up membership on NSE and BSE. The company will have an initial corpus of Rs five crore to begin with, which would be later extended when the company takes up other business including depository services and trading in debt instruments. The exchange has already completed most of the formalities for incorporating the subsidiary and is only awaiting the final clearance of the Registrar of Companies, Kochi.

CSE office-bearers said that the exchange is considering two options to fund the company. The first option is to float the CSE Financial Services as a cent per cent subsidiary of the bourse. The exchange is also considering to hive off some of its real estate assets for raising the necessary funds. The remaining would be raised from banks and financial institutions by way of debt, they said.

The second option mooted by the bourse allows a strategic tie-up with a solid partner, who could raise the necessary finances to pump into the paid up equity capital of the newly floated company. However, CSE would retain the majority stake in the venture, they added.

In a related development, the bourse has decided to spread its wings to other investment centres inside and outside Kerala by shifting the COLT platform to WAN. Initially, the exchange would set up common facilities/terminals for broker members at main centres. The initial centres into which the exchange plans foray include Thrissur and Kozhikode in Kerala and Mumbai. The exchange decision to spread to other centres came in the wake of a SEBI decision waiving the geographical restrictions on the functioning of the regional SEs.

The CSE officials have also said that the exchange has successfully shed the excess staff by implementing a Golden Handshake scheme by which 26 out of its 68 employees were retrenched. The VRS was a part of the exchange exercise to make it leaner and efficient, they said.