SEBI on June 13, 2023 has issued a Corrigendum to Circular on Participation of Mutual funds in repo transactions on Corporate Debt Securities dated June 8, 2023. The corrigendum has clarified that the circular dated June 8, 2023 has revised the Master Circular for Mutual Funds dated May 19, 2023.
The parent circular allowed Mutual Funds to participate in repos on following corporate debt securities:
Listed AA and above rated corporate debt securities
Commercial Papers (CPs) and Certificate of Deposits (CDs)
The circular also provided that for transactions where settlement is guaranteed by a Clearing Corporation, the exposure shall not be considered for the purpose of determination of investment limits for single issuer, group issuer and sector level limits.
