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Regional stock exchanges seek SEBI's help to withstand NSE juggernaut

The countrywide expansion of high-tech National Stock Exchange has dealt a severe blow to the survival of the regional stock exchanges, say top office-bearers of the latter.

They held a meeting with the Securities and Exchange Board of India officials in Bombay on Monday. They said that speculative activities on the NSE had attracted several traders and investors across the country, boosting the NSE's trade volumes at the cost of regional stock exchanges.

RSEs suffer from lack of technology networking and depth in trading volumes, forcing a number of traders and investors to switch over to the NSE and the Bombay Stock Exchange.

A memorandum submitted by the Madhya Pradesh Stock Exchange, Indore, pointed out that ''the NSE was established as a delivery-based exchange to curb speculative trading. However, it has now surpassed all other exchanges in speculative trading and as a result, the small exchanges lost their businesses and revenues.''

SEBI chairman D R Mehta who heard patiently the RSEs' suggestions, agreed to implement various proposals made by the stock exchanges. These included permission for modified carry forward system on the Inter-Connected Stock Exchange and transfer of base minimum capital of RSE members to the ISE for a temporary period.

It was agreed that after certain period of sychronisation of operations between RSE and ISE members, efforts could be made towards virtual integration of members of RSEs and the ICSE.

UNI

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