9911796707
TMI BlogAUTOMATED LENDING AND BORROWING MECHANISM (ALBM)X X X X Extracts X X X X X X X X Extracts X X X X ..... Varma, Member, SEBI Board. This was also discussed by the Risk Management Group constituted by SEBI in its meeting held on July 13, 2000. 2. Based on the recommendations of these Groups, it has been decided that ALBM would now be permitted as a generic product. The basic purpose of ALBM would be to facilitate lending and borrowing of securities as envisaged by the Stock Lending Scheme 1997 (SLS). The ALBM however may also serve the purpose of deferral of settlement by netting off obligations in ALBM with obligations in the normal settlement. This would result in carrying forward of the positions in the normal settlement as in the case of Modified Carry Forward System. 3. ELIGIBILITY OF ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to stand-alone ALBM positions. However, the positions of pure securities borrowers as defined in point no. 6.1 below, who would be withdrawing the shares would be included in the above mentioned overall position limit of ₹ 40 crores in aggregate and ₹ 5 crores per scrip. 5.2 Short Sale Transactions A short seller receives charges in the ALBM when the lending price is below the clearing price. Such charges shall be released to the short seller only if either the seller actually owns the shares (and is using ALBM only for operational convenience or other reasons) or the seller actually has funds by which he could have taken delivery of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to the ALBM margin, at a rate which is higher of the rates determined as per the tables below : Gross Outstanding Market Position (Rs. In crores) Rate of Margin Carry Forward Gross Position (in number of shares as % of total number of shares paid-up) Rate of Margin Exceeding 75 and up to 100 5% Exceeding 3% going up to 4% 5% Exceeding 100 and up to 150 8% Exceeding 4% going up to 5% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .0 RISK MANAGEMENT OF PURE SECURITIES BORROWERS' OBLIGATIONS TO RETURN SECURITIES 6.1 Pure securities borrower means a borrower of securities who does not have an offsetting long trade position. 6.2 Pure securities borrowers will have the option of depositing the collateral with the clearing corporation. A pure securities borrower who does so would not be subjected to any margin. However, if at the end of the settlement, the pure securities borrower wishes to initiate a fresh transaction to continue the pure borrowing of securities for one more week, mark to market margin would be imposed at that stage. The pure securi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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