The Securities and exchange board of India on August 16th 2019 has issued a clarification in a circular with reference to the SEBI circular SEBI/IMD/CIR No. 1/91171/07 dated April 16, 2007 pertaining to investment in Short Term Deposits (STDs) of scheduled commercial banks, pending deployment.
The clarification has been brought in point 5 of the aforementioned circular. As per the clarification, the Asset Management Companies (AMCs)/Trustees should ensure that no funds of a scheme is parked in Short Term Deposits (STD) of a bank which has invested in that scheme.
SEBI has issued this circular in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992 (SEBI Act), read with the provisions of Regulation 77 of SEBI (Mutual Funds) Regulations, 1996. The move will help protect the interests of investors in securities and promote the development and regulation of the securities market.
Click here to see circular.
