India's central bank lifts restrictions on JM Financial's non-banking unit

JM Financial

18/10/2024 18:09

Oct 18 (Reuters) - JM Financial  JMSH.NS  said on Friday
that the Reserve Bank of India has lifted the ban on one of its
units, allowing it to resume financing activities related to
shares and debentures, including providing loans for IPO
subscriptions.
    In March, the central bank barred JM Financial Products from
giving out loans against shares and debentures due to regulatory
violations and governance concerns.
    JM Financial's non-banking unit can now immediately offer
loans against shares and debentures, according to a brief
statement from the financial services group.
    In recent years, India's central bank has been pursuing
regulatory compliance through increased supervision of banks and
non-bank financial institutions. 
        Its latest regulatory action involves four non-banking
finance companies, which have come under scanner due to concerns
about their loan pricing practices.
  
    Separately, the Securities and Exchange Board of India had
also earlier this year barred JM Financial from accepting new
bond issue assignments until March 2025 due to a preliminary
investigation into the company and its non-bank finance
business.
    JM Financial, which offers short-term uncollateralised loans
for IPO subscriptions through its non-bank business JM Financial
Products, did not immediately respond to a Reuters request for
comment. 
        

 (Reporting by Indranil Sarkar in Bengaluru; Editing by Tasim
Zahid)
 ((Indranil.Sarkar@thomsonreuters.com; Mobile:  +91
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