The Securities and Exchange Board of India (Sebi) has proposed an overhaul of investment banking regulations amid a boom in the equity capital market (ECM).
In a consultation paper floated on Wednesday, the regulator has proposed a 10 time-hike in the net worth and provided more clarity on the roles and responsibilities of investment bankers - known as merchant bankers in regulatory parlance.
At present, there are over 200 registered merchant bankers in the country, which help companies launch an initial public offering (IPO) or a listed entity raise additional funds via qualified institutional placements or offer for sale. The current net worth requirement for merchant bankers is â¹5 crore, which was last hiked in 1992 from 1 crore.
The regulator has now proposed to have two categories of investment banks based on their net worth of at least 10 crore will fall under the Category 2 not be allowed to handle main board issues.
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