Sebi defers implementation of the loan default disclosure framework

Capital market regulator Securities and Exchange of India (Sebi) has 'deferred' implementation of the loan default disclosure framework.

Last year, Sebi had issued a circular mandating listed companies to disclose within 24 hours any bank loan default. The circular, however, was withdrawn a day before implementation due to regulatory complications.

"The issue got deferred at our last board meeting," said Sebi Chairman Ajay Tyagi on the sidelines of a conference organised by industry body IVCA.

When asked if the circular has been permanently withdrawn, Tyagi said: "I cannot comment on that...the board will have to decide."

Sebi's circular was seen as a game-changer as it would have improved transparency among corporates and would also have helped the government's efforts to resolve the asset quality problem plaguing the banking industry.

However, the banking industry raised issues with the circular as such default disclosures would have potentially lead to higher provisioning.

Speaking on the growth of the domestic private equity (PE) industry, Tyagi said, "The PE industry has grown substantially in the last few years.

The alternate fund industry now has a diversified portfolio and own assets worth Rs 7.7 trillion."

Tyagi also said the regulations for the Alternative Investment Funds (AIF) industry were "liberals and we have to be careful."

Securities and Exchange Board of India ( SEBI )