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Banking
> Policies> Monetary and Credit Policy 2001-2002
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Clearing Corporation
[Annexure II]
The main features of the proposed Clearing Corporation for clearing of money, government securities and forex markets transactions are:
The Clearing Corporation will be constituted as a limited liability Company under the Indian Companies Act 1956 and will be known as "The Clearing Corporation of India Ltd."
The Company will have an authorised capital of Rs.50 crore.
The Clearing Corporation will be owned by the market participants and promoted by State Bank of India. The other core promoters of the company will be Bank of Baroda, HDFC Bank, ICICI, IDBI and LIC.
The proposed Clearing Corporation will be managed by a Board of Directors headed by a non-executive Chairman.
The Clearing Corporation will address the need for efficient securities settlement system covering money, government securities and forex markets.
The Clearing Corporation will:
- Facilitate extension of repos market to non-Government securities and enlargement of market participants.
- Act as a tri-party agent for efficient management of collateral in consonance with internationally accepted best practices.
- Act as a central counter-party through novation thereby minimising counter-party risk.
The Corporation will also manage a Settlement Guarantee Fund thereby minimising settlement risk.
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