Scribd Logo
Upload

Welcome to Scribd!

  • 994 views

    Presentation On Custodian and Custodial Services

    Uploaded by

    Vireesh Islampure
    The document provides an overview of custodial services and the role and responsibilities of custodians in the secondary market. It discusses the key requirements for registration as a custodian with SEBI, including a minimum net worth of Rs. 50 crores and annual fee of Rs. 10 crores. It outlines general obligations of custodians such as maintaining client confidentiality, segregating activities, and complying with SEBI regulations. Custodians are subject to inspection and audit by SEBI and can have their registration suspended or cancelled if they fail to meet compliance requirements.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd

    Presentation On Custodian and Custodial Services

    Uploaded by

    Vireesh Islampure
    994 views14 pages
    The document provides an overview of custodial services and the role and responsibilities of custodians in the secondary market. It discusses the key requirements for registration as a custodian with SEBI, including a minimum net worth of Rs. 50 crores and annual fee of Rs. 10 crores. It outlines general obligations of custodians such as maintaining client confidentiality, segregating activities, and complying with SEBI regulations. Custodians are subject to inspection and audit by SEBI and can have their registration suspended or cancelled if they fail to meet compliance requirements.

    Original Title

    Presentation on Custodian and Custodial Services

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    PPTX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The document provides an overview of custodial services and the role and responsibilities of custodians in the secondary market. It discusses the key requirements for registration as a custodian with SEBI, including a minimum net worth of Rs. 50 crores and annual fee of Rs. 10 crores. It outlines general obligations of custodians such as maintaining client confidentiality, segregating activities, and complying with SEBI regulations. Custodians are subject to inspection and audit by SEBI and can have their registration suspended or cancelled if they fail to meet compliance requirements.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    994 views14 pages

    Presentation On Custodian and Custodial Services

    Uploaded by

    Vireesh Islampure
    The document provides an overview of custodial services and the role and responsibilities of custodians in the secondary market. It discusses the key requirements for registration as a custodian with SEBI, including a minimum net worth of Rs. 50 crores and annual fee of Rs. 10 crores. It outlines general obligations of custodians such as maintaining client confidentiality, segregating activities, and complying with SEBI regulations. Custodians are subject to inspection and audit by SEBI and can have their registration suspended or cancelled if they fail to meet compliance requirements.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 14

    Presentation on Custodian and custodial services

    DARSHAN-964 VIREESH-985

    INTRODUCTION
    The custodians of securities who provide custodial

    services play a critical role in the secondary market. According to the SEBI regulations, custodial services in relation to securities mean (i) safe-keeping of the securities of a client who enters into an agreement to avail of these securities and (ii) providing services incidental thereto, including:

    Maintaining accounts of the securities of a client;

    Collecting the benefits/rights accruing to him in

    respect of securities; Keeping him informed of the actions taken/ to be taken by the issuer of securities, having a bearing on the benefits/ rights accruing to him; Maintaining and reconciling records of the services referred to above

    Registration
    Registration with SEBI is mandatory Application in prescribed form must be filed along

    with application fee of Rs. 1,00,000 Requirements: Applicant must have net worth of Rs.50crores Applicant must be a body corporate Has to pay an annual fee of Rs.10 crores or 0.01%of the net worth

    General obligations/ Responsibilities


    Code of conduct: Be prompt in distributing dividends / interest /

    any such accruals of income received / collected by him on behalf of his clients, on the securities held in custody. Be continuously accountable for the movement of securities in/out of custody account, deposit and withdrawal of cash from the clients accounts and provide complete audit trail whenever called by the client/SEBI

    Maintain client confidentiality in respect of his

    affairs. Take precautions to ensure that, where records are electronically maintained, continuity in record keeping is not lost / destroyed, and sufficient backup of the records is available.

    Segregation of activities Monitoring/review/evaluation/inspection

    of systems/ controls Prohibition of assignment Separate custody account and agreement with clients Internal controls Maintenance of records Appointment of compliance officer Information to SEBI

    Inspection and audit


    SEBI is empowered to conduct inspection /

    investigation, including inspection by an auditor of the books, of accounts /records /documents /of custodians for any of the following purposes: To ensure that they are being maintained in the manner specified in these regulations. To investigate into complaints received from the investors/clients/any other person on any matter having a bearing on his activities To ascertain compliance with the provisions of the SEBI Act and these regulations.

    Action by SEBI incase of default:


    Suspension of Registration: 2. Cancellation of Registration:
    1.

    Suspension of Registration:
    Failure to furnish any information required by the

    SEBI/furnishing false/ misleading information in material particular. Non-submission of periodic returns / reports required by the SEBI. Non-cooperation in any enquiry / inspection by the SEBI. Failure to update its systems/ procedures as recommended by the SEBI. Failure to pay annual fees Guilty of misconduct / breach of code of conduct

    Cancellation of Registration:
    The SEBI can cancel the Registration of a

    custodian when 1. It is guilty of fraud or has been found convicted of an offence involving moral turpitude, and 2. It has been guilty of repeated default of the nature, leading to suspension.

    Uniform Norms and Practices


    Function as an integral part of the system and integrate with the system. Therefore, no custodian should have such norms and practices as would result in their functioning in isolation, away from the clearing and settlement systems. 2. Become members of clearing houses/ clearing corporations of the stock exchange(s) and participate in the clearing and settlement process, through them, for all securities. 3. Comply with the applicable rules of stock exchanges where they have become members of the clearing house/ clearing corporation. This would facilitate operations of clients, and also result in the reduction of cost of service for the clients.
    1.

    Contd..
    4. Advise all other clients about the facility to settle

    a) b) c) d)

    their trades through the clearing house/ clearing corporation, stressing on advantages such as Time bound rectification of objections No shortages Reduction of risk Cost efficiency

    Thank You

    You might also like