Media Release

Risk Based Supervision

Mumbai, December 11, 2014:  In order to help better regulate the marketplace and strengthen its supervision system, SEBI has initiated a process of formalizing its risk based approach towards supervision of market intermediaries, including stock brokers, in alignment with the global best practices.

The new model would follow four distinct steps — assessing the risk posed by a market entity, assigning ‘risk and impact rating’ to it, determine the supervisory risk rating score and then adopt a suitable supervisory approach.

In order to implement the model, based on the Risk Assessment template formulated by SEBI and Exchanges, BSE has initiated the process of developing the system.  The system would comprise data generated by the Exchange as well as those provided by the members.  The Exchange will provide an electronic interface to the members to enable them to submit the data, which will be collated and analysed by the Exchange system.  

The notice issued by BSE in this regard is - http://www.bseindia.com/markets/MarketInfo/DispNewNoticesCirculars.aspx?page=20141209-1

ABOUT BSE:

BSE (formerly Bombay Stock Exchange Ltd.) – Established in 1875, BSE Ltd. (formerly known as Bombay Stock Exchange Ltd.), is Asia’s first Stock Exchange and one of India’s leading exchange groups and has played a prominent role in developing the Indian capital market. BSE is a corporatized and demutualised entity, with a broad shareholder-base which includes two leading global exchanges, Deutsche Bourse and Singapore Exchange as strategic partners. BSE provides an efficient and transparent market for trading in equity, debt instruments, equity derivatives, currency derivatives, interest rate derivatives, mutual funds and stock lending and borrowing. BSE also has a dedicated platform for trading in equities of small-and-medium enterprises (SME). BSE provides a host of other services to capital market participants including risk management, clearing, settlement, market data services and education. It has a global reach with customers around the world and a nation-wide presence. BSE systems and processes are designed to safeguard market integrity, drive the growth of the Indian capital market and stimulate innovation and competition across all market segments. Indian Clearing Corporation Limited, the wholly owned subsidiary of BSE, acts as the central counterparty to all trades executed on BSE platform and provides full novation guaranteeing the settlement of all bonafide trades executed on the BSE Platform. BSE Institute Ltd, a fully owned subsidiary of BSE, runs one of the most respected capital market educational institutes in the country. Central Depository Services Ltd. (CDSL), a subsidiary of is one of the two central depository services in India.

Yatin Padia – 022 2272 8516 / Ketan Mehta – 022 2272 8321

Marketing Communications

yatin.padia@bseindia.com / ketan.mehta@bseindia.com