Contribution to Core Settlement Guarantee Fund and Default Waterfall for Limited Purpose Clearing Corporation (PLCC)

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ng Corporation ("LPCC") and Default waterfall of LPCC respectively. 2. Based on consultations with various stakeholders, SEBI notified the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) (Second Amendment) Regulations, 2023 (SECC Amendment Regulations, 2023) on July 24, 2023 to enable direct participation by participants in the LPCC for transacting in tri-party repo for corporate bonds. Accordingly, following Para (6.5.1.4) shall be included and Para 6.8.2 and 6.11.1 shall be revised and read as follows: 6.5. Contribution to Core SGF of Limited Purpose Clearing Corporation 6.5.1.4. Participants contribution: Contribution of Participants who desire direct participation and not through a clearin....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....tion towards replenishment of Core SGF by the members / [Participants] would be restricted to only once during a period of 30 calendar days regardless of the number of defaults during the period. The period of 30 calendar days shall commence from the date of notice of default by CC to market participants. 6.11. Default waterfall of LPCC 6.11.1. The default waterfall of CC shall generally follow the following order: a. Monies of defaulting member / [Participants] (including defaulting member's/ [Participant's] primary contribution to Core SGF). b. Insurance, if any. c. Issuers contribution to Core SGF. d. LPCC resources (equal to 5% of MRC). e. Core SGF in the following order: ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... from such and resigned members / [Participants]. (iii) The maximum capped additional contribution by non-defaulting members / [Participants] shall be lower of 2 times of their primary contribution to Core SGF or 10% of the Core SGF on the date of default. (iv) In case of shortfall in recovery of assessed amounts from non-defaulting members /[Participants], further loss can be allocated to layer 'VII' with approval of SEBI." ***In case loss allocation is effected through haircut to payouts, any subsequent usage of funds shall be with prior SEBI approval. Further, any exit by CC post using this layer shall be as per the terms decided by SEBI in public interest. 3. The Clearing Corporations are accordingl....