Mumbai: The Securities and Exchange Board of India (Sebi) is looking to rejuvenate the Securities Lending and Borrowing Scheme (SLB) mechanism by including more securities, allowing mutual funds to sell short and depositories to lend, said two people with direct knowledge of the matter including an official with the capital markets regulator. One of the key proposals is to increase the number of eligible securities under SLB scheme, said the second person on condition of anonymity. Currently, mutual funds are only allowed to lend under SLB and mostly use this in a limited way for hedging. The SLB market was introduced by the National Securities Clearing Corp. Ltd in April 2008. This was a departure from the worldwide practice of an over the counter (OTC) mechanism for borrowing and lending securities.

Source: Mint September 08, 2017 18:11 UTC