Mumbai: On Thursday, SEBI Chairperson Madhabi Puri Buch expressed optimism that advancements in technology and increased transparency will facilitate the rapid growth of the corporate bond market, akin to the equities segment. Speaking at the annual general meeting of the mutual fund industry lobby group AMFI, Buch highlighted the healthy activity in the primary market for corporate bonds, noting that issuances had surpassed Rs 8.50 lakh crore in FY24. However, she pointed out that the secondary market still lacks activity.
Buch remarked on the significant role of transparency and technological advancements, expressing hope that these factors will drive similar growth in the bond market as seen in the equity markets.
Addressing allegations of impropriety, Buch made a light-hearted comment about potential discussions of “conflict” if she were to speak on Real Investment Trusts and ICICI Bank. US-based short seller Hindenburg Research has accused her of promoting REITs due to her husband’s involvement with some trust promoters, and the Congress party alleged that she received a salary from her former employer ICICI Group. She has denied all the allegations.
Buch also reported that monthly volumes in the newly launched repo facility for corporate bonds have reached Rs 20,000 crore. While awaiting approvals from the Reserve Bank on certain proposals, she expressed confidence that corporate repo activity would increase post-approval. She discussed the benefits of newly created platforms for corporate bonds that aim to democratize investments, which should enhance secondary market activity. Buch emphasized the role of fintech and bond platforms in fostering growth and stated that SEBI has standardized disclosure requirements for both private and public bonds.
Regarding equity IPOs, Buch mentioned that no applications have been pending for more than three months. She urged the mutual fund industry to utilize provisions of the stewardship code more actively to amplify the voices of retail investors. Buch commended the mutual fund industry for its role in promoting financial inclusion and revealed that SEBI is on the verge of introducing MF Lite regulations, for which it is open to suggestions.
At the same event, SEBI’s whole-time member Ashwani Bhatia expressed hope that AMFI’s tagline “MF sahi hai” would positively influence investors in the Futures and Options segment, who have been experiencing losses. He noted the stringent nature of regulations, stressing their importance in ensuring the industry’s responsibility in managing others’ money.
Additionally, Buch announced that SEBI would soon launch an essay writing competition with two categories, including one that would allow entries using generative AI applications like ChatGPT, encouraging innovative prompts.