Sebi imposes INR 3 lakh fine on Central Bank of India for violating debenture trustee norms
Central Bank had not entered into written agreements with the issuer companies in respect of Britannia Industries and Deepak Fertilizers and Petrochemicals Corp
The ruling comes after Sebi conducted an inspection of books of accounts and other documents of Central Bank during September 2009 to August 2015 for the possible violation of debenture trustee regulation.
The probe found that Central Bank had not entered into written agreements with the issuer companies in respect of Britannia Industries and Deepak Fertilizers and Petrochemicals Corp, which is in violation of the debenture trustee regulations.
In addition, the bank had not disseminated all information and reports on debt securities including compliance reports filed by the issuers and debenture trustees to the investors and the general public by placing the same on its website, it added.
Accordingly, the Securities and Exchange Board of India (Sebi) has slapped a fine of Rs 3 lakh on the bank.
A debenture trustee is an institution which is the custodian of debentures issued by any corporate. It protects the rights of the debenture holders. For this, the trustee charges a fee. A debenture trustee means a trustee of a trust deed for securing any issue of debentures of a corporate.
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