REGULATORY INSTITUTES SEBI AND RBI

UTKARSH GUPTA B.B.A. VI SEM. A700410019

SEBI-SECURITIES AND EXCHANGE BOARD OF INDIA

The Securities and Exchange Board of India (frequently abbreviated SEBI) is the regulator for the securities market in India. It was formed officially by the Government of India in 1992 with SEBI Act 1992 being passed by the Indian Parliament. Controller of Capital Issues was the regulatory authority before SEBI came into existence it derived authority from the Capital Issues (Control) Act, 1947

PURPOSE AND ROLE OF SEBI

To the issuers it aims to provide a market place in which they can confidently look forward to raising finances they need in an easy fair and efficient manner. To the investors it provides protection of their rights and interests through adequate accurate and authentic information and disclosure of information on a continuous basis. To the intermediaries it offers a competitive , professionalized and expanding market with adequate and efficient infrastructure so as to render better service to investors and issuers.

OBJECTIVES OF SEBI
To regulate stock exchanges and the securities industry and to promote their orderly functioning. To guide , educate and protect the rights and interests of individual investors. To prevent trading malpractices and achieve a balance between self regulation by the securities industry and its statutory regulation. To regulate and develop a code of conduct and fair practices by brokers , merchant bankers with a view to make them competitive and professional.

FUNCTIONS OF SEBI
REGULATORY FUNCTIONS: Registration of brokers and sub brokers and other players in the market Registration of collective investment schemes and Mutual Funds Prohibition of fraudulent and unfair trade practices Controlling insider trading and takeover bids and imposing penalties for such practices

FUNCTIONS OF SEBI
DEVELOPMENT FUNCTIONS:
Investor education Training of intermediaries Promotion of fair practices and code of conduct of all SROs Conducting research and publishing information useful to all market participants

RBI-RESERVE BANK OF INDIA

Central bank is the apex bank in a country. It is called by different names in different countries. RBI was established in the year 1935 under the reserve bank of India act, 1934. The Central Office of the Reserve Bank was initially established in Calcutta but was permanently moved to Mumbai in 1937. Indias monetary authority. Supervisor of financial system . Managed by Central Board of Directors.

PREAMBLE..
The Preamble of the Reserve Bank of India describes the basic objectives of the Reserve Bank as "...to regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage."

ROLE OF RBI IN INDIAN ECONOMY

The Reserve Bank is the umbrella network for numerous activities, all related to the nations financial sector, encompassing and extending beyond the functions of a typical central bank. This section provides an overview of our primary activities: Provision of finance Promotional activities Issuer of Currency Banker and Debt Manager to Government Banker to Banks Regulator of the Banking System Manager of Foreign Exchange Regulator and Supervisor of the Payment and Settlement Systems

REGULATORY FUNCTIONS OF RBI

CREDIT CONTROL: It refers to the regulation by monetary authority[RBI] of the volume & direction of credit of the banking system. In times of inflation -contraction of credit. During deflation-expansion of credit. For price & exchange stability.

OBJECTIVES OF CREDIT CONTROL

To stabilize the internal price level. To stabilize the rate of foreign exchange. To protect the outflow of gold. To control business cycles. To meet business needs. To have growth with stability.

INSTRUMENTS OF CREDIT CONTROL

DIRECT INSTRUMENTS:
Cash Reserve Ratio (CRR). Statutory Liquidity Ratio (SLR). Refinance facilities. INDIRECT INSTRUMENTS: Repo/reverse repo rate. Bank rate.

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