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After a slew of resignations from the board of NSEL (a spot exchange floated by Financial Technologies) following the payment crisis, a new board will be announced very soon.
NSEL (National Spot Exchange of India Ltd) had 7 members on the board including a chairman. After resignations, including that of chairman Shankarlal Guru over, only two members remain on the board. Sources say that the new chairman and board members will be announced very soon.
Just before the exchange announced a new payment schedule on 14 August, Shreekant Javalgekar, who is MD of FT group’s commodity futures exchange - the Multi Commodity Exchange (MCX), resigned from the NSEL board on 13 August. Guru is understood to have resigned in early August. He happens to be father in law of Nilesh Patel who owns N K Protins, the company which defaulted on the NSEL by Rs.967 crore and had told the exchange that it will sell properties and make payment.
After that the chairman Guru, B D Pawar and Ramanathan Devarajan had also left the board.
The exchange had removed its MD and CEO Anjani Sinha last week.
Now only Jignesh Shah, who is FT group CEO & vice chairman of NSEL, and Joseph Massey, who is MD of the group’s stock exchange MCX-SX, have remained on the board.
The resignations followed the crisis, which began when the consumer affairs ministry wrote to NSEL in the second week of July, asking it not to launch any fresh contracts and settle all contracts on maturity. This, saw the exchange announcing suspension of trading. But this in turn resulted in a payment crisis and later I-T survey of all 24 buyer parties who failed to make payment on maturity.
Forward markets commission (FMC) has been given powers to resolve the crisis and it has already threatened the NSEL board of stricter actions.
