Sebi mulls appointment of administrator for BSE

Sebi mulls appointment of administrator for BSE
ENS ECONOMIC BUREAU

Mumbai, March 13: After sacking the broker director, the Securities and Exchange Board of India (Sebi) is mulling the appointment of an administrator for the Bombay Stock Exchange (BSE), even as the latter has decided to go ahead with the elections for the three directors of the exchange as per schedule. The Sebi on Monday, restrained the broker-directors of the exchange from acting in such capacity till further orders.

"BSE has the board in place with the non-broker directors and the executive director taking care of the day to day affairs. Sebi is only ascertaining the legal position on the issue of appointing an administrator," a Sebi official said.

In case it is legally possible, Sebi is considering appointment of former Maharashtra additional chief secretary (Home) S Jambunathan to the position. Mr Jambunathan had served on the BSE board for about four years in the past.

Meanwhile, elections for the three board vacancies would be held as per schedule, BSE said in a release on Tuesday. The elections are scheduled to be held on March 28.

The elections would be held for filling the positions held by directors JC Parekh, Bhagirat Merchant and Kirit Bhagwandas Shah. Parekh was sacked as BSE president in 1999 in the wake of the price rigging case involving BPL, Videocon and Sterlite stocks, while Merchant has quit to become a director on the board of Central Depository Services Ltd (CDSL), a BSE subsidiary. Shah's term as director comes to an end after the expiry of the specified period.

After the elected directors were suspended from acting in that capacity by the Sebi in the wake of the alleged involvement of elected-directors in sharing exchange surviellance related information, the day to day management has passed on to the nine non-broker directors and executive director AN Joshi.

To dispel rumours that the exchange was planning to withdraw its mutual funds investments, BSE clarified that it was investing in mutual funds as part of its investment policy and according to the procedures laid down. Out of the total investments of Rs 1,037 crore on March 13, 2001, BSE has invested only Rs 58 crore (5.6 per cent) in mutual funds. As these funds were dfirectly invested by the exchange, no brokerage was paid on such investments, it clarified.