Market regulator Securities and Exchange Board of India has raised the ceiling for investment in housing finance companies by debt-oriented mutual funds. This could turn out to be a booster for housing finance.

Debt-oriented mutual fund schemes will now be allowed additional 10 per cent exposure to the financial services sector, over and above the existing 30 per cent. This would be by way of increasing exposure to the National Housing Bank-registered Housing Finance Companies (HFCs) only. Moreover, the securities to be invested in, should have a rating of AA and above.

The amendments were made at SEBI’s board meeting here on Saturday. Starting January 1, 2014, FIIs will be allowed to re-invest during the calendar year up to 50 per cent of their debt holdings at the end of the previous calendar year. The utilisation period for Government and corporate debt limits has been reduced to 30 days and 60 days, respectively. Following demands for the dematerialisation of assets and records other than securities such as fixed deposits with banks and corporates, insurance policies, and investment products of Post Office, the market regulator has allowed depositories access to investor details. This move will enable investor to view details of all their holdings and transactions across all asset classes through a single consolidated statement.

To safeguard investor interest with regard to the minimum public shareholding norms coming into effect next year, the market regulator has mandated that stock exchanges should carefully monitor adherence and take steps to issue advisories to shareholders of non-compliant companies about potential penal actions.

SEBI also clarified that listed companies coming out with further public offers need not meet profitability criteria.

> manisha.jha@thehindu.co.in

> sneha.p@thehindu.co.in

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