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May 1, 2001
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Money > Business Headlines > Report May 1, 2001 |
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CSE panel mulls BSE and NSE membershipAniek Paul The Calcutta Stock Exchange management sub-committee is considering a proposal of seeking membership of larger bourses such as the Bombay Stock Exchange or National Stock Exchange through the subsidiary route. The proposal emanated from the senior brokers of the bourse, and came up for discussion in the meeting between past presidents and the management sub-committee on Saturday, CSE executive director Tapas Datta said, adding that no final decision on the matter had been taken as yet. "Such a move would mark the demise of CSE as we know it, and also a clear reversal from CSE's earlier move to bring under its umbrella bourses smaller than itself. It may be recalled that few weaker bourses had actually become member of CSE through the subsidiary route," he said. Datta said, "We should probably take a leaf out of the experience of the Interconnected Stock Exchange, and instead, seek membership of a bigger bourse. A combine of the weaker bourses would not help our cause much." He also said with the Securities and Exchange Board of India likely to approve the proposal to ban carry forward on the regular segment, and separate deferral products, it might not be possible for CSE to bear the costs of developing a platform for deferral products. In addition, membership of a bigger bourse would mean greater depth in the cash segment. "Currently, trading at CSE is focused on a handful of scrips, volume in which would diminish with the ban on carry forward," he said. "Our members would then need to have greater liquidity in a wide range of stocks, and not in the 10-12 stocks only which attract maximum activity now," Datta said, explaining the advantages that might be derived by such membership. Besides, a large number of brokers may not be able to meet the net worth criterion that is likely to be placed for being a member of the deferral products segment. The exchange becoming a member of NSE or BSE would remedy the problem, as the brokers would then be able to trade on the segment through the CSE subsidiary route. Meanwhile, the exchange is planning to raise a number of charges in a bid to raise its revenues. CSE has already decided to double turnover charges from Rs 250 per Rs 10 million of transaction, to Rs 500. Datta said, a number of other charges paid by the brokers to the exchange may also be increased. Powered by YOU MAY ALSO WANT TO READ:
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