04/27/2020 SEBI relaxes
valuation norms for mutual funds
The Securities and Exchange Board of India (SEBI) on Thursday relaxed valuation norms on money and debt market instruments held by mutual funds in the wake of the loan moratorium for companies by the Reserve Bank of India on account of the business disruptions caused by the ongoing lockdown.
The capital markets regulator said if valuation agencies are of the view that a delay in interest or principal amount or extension of maturity of a security has arisen solely due to lockdown or in light of the RBI moratorium, which has created temporary operational challenges in servicing debt, they may not consider it as default for valuing debt market securities held by fund houses. Valuations of debt market instruments for mutual funds’ net asset value (NAV) are done by the arms of rating agencies.
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