From 2022 onwards, all primary dealers shall have to maintain a minimum capital requirement of Rs 2 billion. The requirement will increase to Rs 2.5 billion in 2023. Companies are expected to maintain a core capital of Rs. 1 billion until the end of 2021.
Every primary dealer is expected to maintain a special risk reserve to support the stability of the Primary Dealer system. Primary dealers will have to maintain at least 10 percent of profit after tax in a special risk reserve. The director of Supervision of NBFIs will be empowered to require any particular primary dealer to transfer a sum higher than 10 percent to the risk reserve.
Primary dealers will have to maintain a distribution policy that maintains beforehand the criteria by which the board of directors will choose to distribute earnings to its shareholders.
0 comments: