Banking Awareness: Important Facts About SEBI

sebi

Dear Reader, You already would have heard about SEBI – Securities and Exchange Board of India. Below are some important facts which every bank job aspirant must know.

  • Securities and Exchange Board of India (SEBI) was established in 1988 as a replacement of the Controller of Capital Issues (CCI) which was the regulatory authority before SEBI.
  • SEBI was given statutory powers on 12 April 1992 through SEBI Act, 1992.
  • SEBI acts as the regulator for the securities market in India.
  • Its Head quarters is located in Mumbai.



Objectives of SEBI:

  • To regulate activities of stock exchange
  • To safeguard the rights of investors and also to ensure the safety of their investment
  • To prevent malpractices by balancing its self regulating business and statutory regulations
  • To manage and develop a code of conduct for intermediaries



SEBI operates to fulfil the needs of the following three groups

  1. Issuers – SEBI provides a market place in which they (the issuers) can raise finance fairly.
  2. Investors – SEBI provides safety and supply of accurate and correct information
  3. Intermediaries – SEBI provides a competitive professional market for intermediaries.



Organisational Structure of SEBI:

  • A Chairman (nominated by Union Government of India)– Upendra Kumar Sinha
  • 2 members – one official from the Ministry of finance (Joint Secretary, Prakash Chandra) and another from Administration of Company Act, 1956. (Secretary, Naved Masood)
  • 1 official from RBI (Deputy Governor, Anand Sinha)
  • 5 other members out of that 3 shall be whole time members appointed by the central government.

They are as follows:

  1. Nishant Rathi – full-time member
  2. Rajeev Kumar Agarwal – full-time member
  3. S. Raman – full-time member
  4. V. K. Jairath Magya – Part-time member
  5. Raje Kumar – part-time member



Functions of SEBI:

  1. Regulatory Functions are performed to regulate the business in stock exchange
    • SEBI regulates the workflow of mutual funds
    • It also conduct inquiries and audit of stock exchanges
    • It frames the rules and regulations and to develop a code conduct between intermediaries
  2. Protective Functions are performed to protect the interest of investors and also safety for their investment.
    • It involves to check on Price Rigging.
    • It prohibits insider trading
    • It also prohibits fraudulent and Unfair Trade Practices
  3. Development Functions are performed to develop the activities of stock exchange and improve the business.
    • It gives training for intermediaries of the securities market
    • It promotes the activities of stock exchange



Some of the Committees formed by SEBI are as follows:

  • Alternative Investment Policy Advisory Committee (AIPAC)
  • Risk Management Review Committee (RMRC)
  • Takeover Regulations Advisory Committee
  • Technical Advisory Committee
  • Primary Market Advisory Committee (PMAC)
  • Depository System Review Committee (DSRC)
  • Corporate Bonds and Securitization Advisory Committee (CoBoSAC)
  • SEBI Committee on Disclosures and Accounting Standards (SCODA)
  • Qualified Audit Report Review Committee (QARC)

Ready for short practice test?
Start Test Here

If you want clarification for any doubts, please use the comments section below. Also please let us know if you have suggestions or corrections.

Leave a comment:

Your email address will not be published.

71 + = 75