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SPEEDY Railway Book (English)

Important Key Points about SEBI for Banking Exams

"Securities & Exchange Board of India (SEBI)"

SEBI was constituted by Govt. of India during 1988 and accorded statutory powers under SEBI Act, 1992, with the objectives –

  • To promote the development of security market
  • To protect interest of investors
  • To regulate the security market

The SEBI Act was amended on 25th January, 1995 to give additional powers for ensuring orderly development of the capital market and to enhance SEBI ability to protect the interests of the investors. SEBI can file complaints in courts and notify its regulations without the prior approval of Central Government.

SEBI is managed by its Chairman and 5 members and has departments such as –
  • Issue Management Department
  • Primary Market Department
  • Secondary Market Department
  • Institutional Investment Department
  • It has 2 advisory committees, one each for primary and secondary market to provide advisory guidance in framing policies and regulations.

SEBI has been able to introduce certain measure such as –
  1. Payment of Interest on refund amount after 30 days from date of closure of issue;
  2. Allotment of shares only if minimum 90% subscription is received from the public;
  3. Completion of allotment with in 30days;
  4. Publication of quarterly results;
  5. To refund the application money in case of non-allotment within 90 days;
  6. Free pricing of equity issues by companies;
  7. Adequate exposure of all material and specific risk factors associated with project in the prospectus and the same to be attached with share application form;
  8. Introduction of stock-invests for subscription.
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