Former chairman of Life Insurance Corporation (LIC), S B Mathur, is likely to take over as the new non-executive chairman of the National Stock Exchange (NSE), the country's largest equity trading bourse. According to industry sources, Mathur's name is under consideration of the Securities and Exchange Board of India (Sebi) after NSE proposed it.
Mathur will take over, as economist Vijay Kelkar stepped down from the post to avoid conflict of interest, as specified by the regulatory norms.
NSE is also likely to propose yet another extension to Ravi Narain, the 56-year-old managing director, after his term ends next year. Narain's extension might be important for NSE in the wake of the upcoming competition from the MCX-SX group, whose recent roadshow has been received well by domestic stock brokers around the country. Narain has been with NSE since its inception in 1994 and Chitra Ramkrishna, the current joint managing director had joined NSE six months later. Prior to that, both were deputy general managers at IDBI.
New regulatory norms that came into effect a couple of months ago do not allow any board member of banks or broking companies to chair a stock exchange in the country. Kelkar is on the board of Mumbai-based brokerage firm J M Financial as independent director. Kelkar, however, will chair NSE's advisory board.
While former Sebi chairman C B Bhave was not averse to allowing brokers on the boards of stock exchanges, current chief U K Sinha has expressed reservations. This is after the Bimal Jalan committee said brokers and bankers should not be given much representation. Sebi had said exchanges could have a separate advisory committee to take advantage of the experience of such members.
Already, stock brokers on the board of Bombay Stock Exchange have quit.
Besides stock exchanges, boards of clearing corporations will not be allowed to have clearing member-representatives, Sebi has said. Here, two-thirds of the board would comprise public interest directors and shareholder directors the rest.