The Securities and Exchange Board of India (SEBI) on July 27, 2023, issued a Framework for Corporate Debt Market Development Fund (CDMDF)
The following has been stated namely: -
• It states that the CDMDF shall comply with the Guarantee Scheme for corporate Debt (GSCD)as notified by the Ministry of Finance vide notification no. G.S.R. 559(E)dated July 26, 2023, which includes Framework for Corporate Debt Market Development Fund
• It states that the CDMDF shall comply with the following namely: -
(i) The fund shall deal only in the following securities during normal times:
(ii) Low-duration Government Securities
(iii) Treasury bills
(iv) Tri-party Repo on G-sec
(v) Guaranteed corporate bond repo with a maturity not exceeding 7 day
• It states that The fees and expenses of the Fund shall be as follows namely: -
(i) During Normal times: (0.15% + tax) of the Portfolio Value charged on a daily pro-rata basis.
(ii) During Market stress: (0.20% + tax) of the Portfolio Value charged on a daily pro-rata basis.
(iii) “Portfolio Value” means the aggregate amount of portfolio of investments including cash balance without netting off of leverage undertaken by the Fund.
• It states that DMDF shall follow the Fair Pricing document as placed in Annexure A while the purchase of corporate debt securities during market dislocation
• The CDMDF shall follow the loss waterfall accounting, as prescribed in Annexure B.
• The CDMDF shall disclose the Net Asset Value (NAV) of the fund by 9:30 PM on all business days on the website of its Investment Manager and AMFI. For times when CDMDF would have exposure to corporate debt, such NAV shall be disclosed by 11 PM on all business days.
• This Circular is available at www.sebi.gov.in under the link “Legal > Circulars”
[Circular No. SEBI/HO/IMD/PoD2/P/CIR/2023/128]
