The National Stock Exchange (NSE) on June 12, 2023, issued a notification regarding the Discontinuation of acceptance of securities as collateral through approved custodians for the Securities Lending & Borrowing Scheme, Currency Derivatives, Futures & Options, NSE Clearing - Capital Market
This has a reference to the SEBI circular SEBI/HO/MIRSD/DOP/CIR/P/2020/28 dated February 25, 2020, which has provided a framework for margin obligations to be given by way of pledge / Re-pledge in the Depositary System.
The following has been stated namely: -
• It states that it has proposed to discontinue the services of approved custodians for the purpose of pledging securities as collateral with NCL towards security or margin deposits as follows: -
(i) No fresh securities shall be permitted to be pledged to NCL accounts towards security /margin deposit in any segment through custodian with effect from July 01, 2023.
(ii) The existing securities already pledged through custodians shall be revalued daily and the release of the pledge shall be permitted as per the existing process.
(iii) Members having existing pledges through custodians shall need to release the same latest by September 30th, 2023.
(iv) Clearing Members can continue to pledge their own securities towards membership /margin deposits through direct pledges in favor of NCL or through a pledge-re-pledge mechanism provided by NSDL and CDSL
[Circular No. NCL/CMPT/ 57052]
