SHARING OF
INFORMATION REGARDING ISSUER COMPANIES BETWEEN DEBENTURE TRUSTEES AND CREDIT
RATING AGENCIES
Circular No.: CIR/MIRSD/3/2013
Date: 15/03/2013
SEBI (Debenture Trustee) Regulations, 1993
require the Debenture Trustees (DTs) to share information regarding the issuer
companies that are their clients, with Credit Rating Agencies (CRAs). The
purpose of the Regulations is to enable CRAs to perform their obligations
effectively.
DTs have also expressed the need to receive
relevant information on issuer companies from CRAs.
In consultation with DTs and CRAs, it has
been decided that registered DTs and CRAs shall share information with each
other as specified in the Annexure. DTs and CRAs may share any other
information from time to time in respect of issues/issuer companies which would
help them in effective discharge of their duties.
Further, the DTs and CRAs shall assign
designated email addresses for sending and receiving such information and
ensure appropriate action, if any, based on the information received.
Sharing of information between
Debenture Trustees (DTs) and Credit Rating Agencies (CRAs)
A. Information from CRAs to DTs
1. Rating assigned/revised for debt
securities along with the rationale for the same.
2. Press release, outstanding ratings etc. in respect of
debt securities.
3. Non-cooperation by the issuers with
respect to sharing necessary information
for monitoring the credit quality of the rated instrument with CRAs.
4. Press release and separate communication
to DT on withdrawal of rating post
redemption of entire amount due towards debenture-holders.
5. Default of any type committed by the
issuer.
B. Information from DTs to CRAs
1. Whether the asset in respect of
which security has been created is free from any encumbrance and adequate to
ensure asset cover for the debentures or if there is any breach of the terms of
creation of the security. This information shall be shared on half yearly
basis.
2. Funds transferred to Debenture
Redemption Reserve(DRR), depletion of the DRR/invocation of guarantee which
could affect the payment of debenture obligations. This information shall be
shared annually.
3. Details of redemption of the issue.
4. Any default committed including the
default in payment of interest or redemption of debentures or delay in creation
of security.
5. Any change or restructuring of the terms of the issue.
6. Periodic reports from lead banks
about the progress of the project for which funds have been raised through
debentures and certificate from issuer’s auditors in respect of utilization of
funds.
7. Details of grievances filed by
debenture-holders and action taken to resolve them.
8. Non cooperation by the issuer with
respect to furnishing required reports/certificates/information.
Information pertaining to points 3 to 8 shall be shared as and when available.
Regards
CA. Mona Singhal
Partner
Arpit Gupta & Associates
Chartered Accountants
701, Nirmal Tower,
26, Barakhamba Road,
Connaught Place, Delhi-110001
Mobile:- +91-9873082769
Website: www.caaga.co.in
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