Strengthening its risk management mechanism, markets regulator Sebi on Friday barred banks from using their own Fixed Deposit Receipts (FDRs) as collateral in their function as trading or clearing members of stock exchanges, directly or through associate entities.
In a circular to clearing corporations, Sebi asked them not to accept such FDRs while trading or clearing members having already deposited their own FDRs or that of associate banks would need to replace them with other eligible collaterals within 6 months.