Advertisement

HindustanTimes Wed,24 Sep 2014

Will CBI enquiry on ex-Sebi chief Bhave hit bank licences?

HT Correspondent, Hindustan Times  New Delhi, March 22, 2014
First Published: 00:22 IST(22/3/2014) | Last Updated: 00:24 IST(22/3/2014)

The CBI’s controversial decision to launch a preliminary enquiry (PE) against former Securities and Exchange Board of India (Sebi) chairman CB Bhave regarding approvals granted to MCX stock exchange has set off a fear that it could unwittingly affect the grant of new bank licences.

Advertisement

Bhave was a member of the committee headed by former RBI governor Bimal Jalan that screened applications and gave recommendations to the central bank on the basis of the “fit and proper” criteria.

Other members of the high-level advisory committee include former RBI deputy governor Usha Thorat and Nachiket M Mor, director of the central board of directors of the RBI. The committee submitted its report last month.

The CBI has registered a PE against Bhave, Sebi’s former whole-time member KM Abraham and Jignesh Shah-led Financial Technologies and Multi Commodity Exchange (MCX) last week in a case related to the grant of licence to MCX-SX in 2008.

Experts have expressed concern that the move could be cited as a reason to delay granting of new bank licences as Bhave happened to be a member of the Jalan committee.

Though a final approval might come later, the RBI is expected to give in-principle nod to a few applicants initially.

The CBI’s move against Bhave and Abraham has triggered strong reactions from corporate leaders, former bureaucrats and ministers.

They have expressed surprise at the investigating agency’s decision to move against Bhave and Abraham.

MCX-SX, which was set up by FTIL and MCX, was initially given licence to operate in a limited segment of currency derivatives in 2008, but Sebi refused permission to allow it to act as a full-fledged bourse for years as it was not found to be in compliance with existing regulations for the same.

Bhave told news agency Press Trust of India recently that the agency was working with a “crazy logic” and has ignored the fact that the tax department itself found no merit in the case years ago.


Advertisement
more from Business

Future Group to foray into food manufacturing

Amid debt challenges and margin pressures in the retail sector, Future Group’s foray into food manufacturing will kick-start with Modi inaugurating the first of its three mega food parks in Tumkur, near Bangalore, on Wednesday.
markets
Advertisement
Most Popular
Advertisement
Advertisement
Copyright © 2014 HT Media Limited. All Rights Reserved