The financial limits of the delegated authority of various top executives of the New India Assurance Company (NIA) for purchase/sale of equity/preference shares/debentures and other approved market securities have been recently increased by 20-30 per cent.
The board of directors of NIA has also given the green signal to commence trading in statutory liquidity ratio (SLR) and non-SLR debt.
Though the per company investment limit per calendar month of top executives has been left unchanged, their (executives) overall investment limits have seen a drastic increase, as per the minutes of the board meeting of NIA.
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The per calendar month investment limit of the chairman and managing director (CMD) of NIA has been increased by 30 per cent to Rs 52 crore (Rs 12 crore in equity and Rs 40 crore in debt) as against the overall limit of Rs 40 crore earlier.
In respect of two general managers (one of whom holds charge of the investment department), the overall combined monthly investment limit has been hiked by 25 per cent to Rs 30 crore (Rs 6 crore equity and Rs 24 crore debt) as against their overall limit of Rs 24 crore earlier.
Again, the individual overall monthly investment limit of the general manager (investment department) has been hiked by 20 per cent to Rs 12 crore (Rs 2 crore equity and Rs 10 crore in debt), while in the case of the assistant general manager (investment department) this limit stands increased by 25 per cent to Rs 5 crore (Rs 1 crore equity and Rs 4 crore debt).
In regard to trading in SLR debt, NIA has set an exposure limit of Rs 40 crore to Rs 70 crore subject to per stock exposure not exceeding Rs 20 crore, while in the case of trading in non-SLR debt the limit has been pegged between Rs 30 crore and Rs 60 crore subject to per company exposure not exceeding Rs 15 crore.
Further, the total book size for SLR and non-SLR debt trading has been set at less than or equal to Rs 100 crore. The holding period for securities under the two categories will be 90 calendar days from the date of purchase and the stop-loss limit has set at four per cent of the purchase price.