Page 16 - Banking Finance June 2025

MUTUAL FUND

SEBI Proposes Relaxed

Delisting Norms for PSUs
with 90% Govt Holding
The Securities and Exchange Board of
India (SEBI) has proposed easing the
delisting process for public sector un-
dertakings (PSUs) where the govern- Ò»©­
ment holds more than 90%. In a recent
consultation paper, SEBI suggested
such PSUs could be exempted from
adhering to the mandatory 25% mini-
mum public shareholding norm.

It also proposed removing the require-
ment for a two-thirds majority share- MFIs to Enforce Revised Loan Pricing and Exposure
holder approval for delisting. Delisting
in these cases may follow a fixed price Norms from June 1
mechanism, set at a minimum 15% Microfinance Institutions (MFIs) will implement stricter guidelines on loan
premium over the floor price, regard- pricing, borrower indebtedness, and lending discipline starting June 1, 2025,
less of trading frequency. SEBI noted under the SANKALP 2.0 framework. According to Sa-Dhan, the self-regula-
that several PSUs, despite lacking fu- tory organization overseeing MFIs, the changes are essential to safeguard
ture viability due to obsolete products borrower interests and enhance transparency in the sector.
or government asset sale decisions,
Under the new rules, loan pricing must be clearly defined and approved by
may trade at elevated prices due to
the Board, with processing fees capped at 1.5% (excluding taxes). Borrow-
investor trust in government backing.
ers cannot receive loans from more than three lenders, and the total house-
The regulator warned that high public hold exposure to microfinance and retail loans must remain under Rs. 2 lakh.
sentiment could result in an inflated floor Additionally, MFIs cannot issue fresh loans to borrowers within 12 months
price, increasing fiscal burden on the of a prior loan disbursement or before 50% of that loan is repaid.
exchequer. The proposal aims to create Mandatory credit bureau checks at both client and household levels will also
a pragmatic route for PSU delisting.
be enforced. Sa-Dhan's 220 members across 646 districts are expected to
comply strictly with these revised norms.
Companies Barred from
Claiming Tax Deductions This means that fines, penalties, and seen as part of broader efforts to en-
on Regulatory Settlements settlement amounts related to these force corporate discipline and compli-
laws will no longer reduce a company's ance.
The Central Board of Direct Taxes
taxable income. Legal expert Abhishek
(CBDT) has ruled that expenses in- Franklin Templeton Merges
curred in settling regulatory violations Rastogi commented, "The government
is sending a strong message that non- European Fund with U.S.
under key financial and competition
laws cannot be claimed as tax deduc- compliance will carry financial conse- Scheme Amid Sluggish Out-
tions. Effective from April 23, the noti- quences-not just in fines but also in tax
fication clarifies that payments under treatment." look
the SEBI Act, Securities Contracts The amendment seeks to discourage Franklin Templeton India Mutual Fund
Regulation Act, Depositories Act, and companies from violating regulatory has announced the merger of its two
Competition Act will not qualify as busi- norms and closes the loophole allow- international feeder funds - Franklin
ness expenditure under Section 37 of ing them to reduce tax liabilities India Feeder - Templeton European
the Income-tax Act. through such expenses. The move is Opportunities Fund and Franklin India

14 | 2025 | JUNE | BANKING FINANCE