Amended capital market exposure rules aimed at curbing bank lending for speculative purposes could raise costs for domestic proprietary traders, benefiting their global counterparts.
MUMBAI: A Reserve Bank of India move meant to curb bank funding for speculativetrading purposes risks creating an uneven playing field in India’s equity markets, with domestic proprietary traders fearing foreign rivals could gain easier access to global bank-backed funding.
“The Reserve Bank of India’s (RBI) directive to banks on curbing loans to proprietary traders, or brokers who trade for themselves, is perfectly justified, but from a rules perspective gives an edge to foreign prop traders,” said Sagar Lakhani, Partner, Accounting and Reporting Consulting, Uniqus Consultech.
Source: Live Mint
