The Securities and Exchange Board of India (SEBI) on Thursday allowed the listing of securitised debt instruments or certificates on exchanges, a decision that would boost the debt market.
The market regulator came out with ‘Listing agreement for securitised debt instruments' and said the move would help improve the secondary market liquidity for such instruments.
Securitisation involves pooling of financial assets and the issuance of securities that are re-paid from the cash flows generated by these assets.
Common assets for securitisation include credit cards, mortgages, auto and consumer loans, student loans, corporate debt, export receivable and offshore remittances.
“With a view to enhancing information available on the public domain on performance of asset pools on which securitised debt instruments are issued, it has been decided to put in place a listing agreement for securitised debt instruments,” SEBI said in a circular.
The listing agreement for securitised debt instruments shall come into force with immediate effect, added the SEBI circular.