CSE members face account adjustment

Calcutta Stock Exchange (CSE) has adjusted the erosion in settlement guarantee fund (SGF) with the members' account three years after withdrawal of fund from the account.

Out of 600-odd members, the old ones have had to bear the loss of Rs 2.5 lakh from their SGF. New ones will have to dish out a larger sum of Rs 7.5 lakh from their accounts.

CSE had withdrawn nearly Rs 25 crore from SGF, a kitty meant for crisis management, to bridge the Rs 100 crore payment crisis- shortfall between pay-in and pay-out of funds- that rocked the exchange in March 2001.

Although the withdrawal was provided in the CSE's annual reports, the members' contributions towards SGF remained untouched as no administrator, in charge of day to day functioning of the bourse, dared to handle this sensitive issue.

Veteran Lyons Range members said the trustee of SGF had the right to withdraw funds from it and adjust it with the brokers' account.

The only debatable issue at present, they added, was justification of the withdrawal.

However, CSE is yet to serve notice to the members. The brokers need the notice to adjust the loss with profits so that they could get tax relief.