Market regulator SEBI has finally cleared the way for Ashish Chauhan to take over as the new MD and CEO of the National Stock Exchange (NSE). In a letter sent to the NSE, SEBI said that Chauhan should be appointed for a period of five years, sources told BusinessLine.
Chauhan is currently the MD and CEO of BSE and is known for reviving the exchange, which was on the verge of a shutdown in 2009. After Chauhan took over as BSE chief, the exchange and its subsidiary CDSL, the largest depository, launched successful IPOs. Chauhan tightened the regulatory checks and balances at BSE to rev up the exchange’s sagging reputation and entered into new segments of the business stream.
NSE said in a statement that Chauhan’s appointment is subject to acceptance of the offer made to him and fulfillment of terms and conditions including approval from the shareholders of NSE. In the interim, the Governing Board of NSE has decided to appoint an Internal Executive Committee comprising of Yatrik Vin, Group CFO & Head Corporate Affairs, Priya Subbaraman, Chief Regulatory Officer, Somasundaram KS, Chief Enterprise Risk & Information Security Officer and Shiv Kumar Bhasin, Chief Technology & Operations Officer for the purpose of running the affairs of the company. The Committee will be dissolved upon the new MD & CEO assuming office.
Uphill task ahead
At NSE, Chauhan again has an uphill task to steer the exchange through bad times since it is embroiled in a co-location scam inquiry resulting in ouster and arrest of its former MD and CEO Chitra Ramkrishna and group chief operating officer Anand Subramanian by the Central Bureau of Investigations (CBI) and Enforcement Directorate (ED).
Recently, the CBI and the ED have also registered a case of phone tapping against former and current key NSE officials including the acting vice president Ravi Varanasi.
Varanasi was also named in the co-location scam and has been fined several crores of rupees by SEBI. NSE’s current MD and CEO Vikram Limaye was also issued a show cause notice by SEBI for lapses at various levels in the exchange.
Under Limaye, while profits of NSE rose steadily due to the high share of derivatives trading, the exchange remained mired in controversies due to its creaking technology infrastructure that led to frequent glitches.
Show cause notice
In a show cause notice a few months ago, SEBI charged Limaye, chief of operations and technology Shiv Kumar Bhasin, and National Clearing Ltd (NCL) MD and CEO Vikram Kothari with a casual, lackadaisical and less-than-honest approach.
NSE had suffered a four-hour-long trading disruption witnessed on February 24, 2021, as its critical trading infrastructure suffered a massive breakdown due to faulty design and lower than required capacity to handle the peak load.
Chauhan, who had played a key role as one of the founding team members of NSE in 1992, has his task cut out now.