Sebi updates HLCC panel on May 17 meltdown

The Securities and Exchange Board of India (Sebi) is understood to have presented details of the happenings of the recent May 17 crash at the high level coordination committee on financial and capital markets (HLCCFM) held at the Reserve Bank of India (RBI).

According to the sources close to the development, while there were no irregularities found by Sebi in the selling behaviour of the market players on the day, the RBI in its investigations found banks responsive to the clients requirements.

The investigation was done on brokers' complaints alleging that banks were not supportive of them in lending funds to cope with the crisis.

Sebi has already submitted the report on Monday crash to the finance ministry.

On the other hand, sources said that norms for facilitating Indian residents to invest in overseas indexed funds under the $25,000 remittance facility were also discussed.

At present, there are no overseas indexed funds in India. On the other hand, domestic mutual funds are allowed to invest in overseas investment funds which can buy stake in companies with listed subsidiaries in India.

Earlier, RBI came out with a directive stating that any product floated under the $25,000 scheme will have to be vetted by the central bank.