Sebi focuses on strengthening corporate bond market: Chairman

Sebi will prioritise the development of the corporate bond market this year, with plans to introduce credit bond indices and related derivatives in coordination with the RBI, Chairman Tuhin Kanta Pandey said as the regulator seeks to deepen liquidity and broaden investor participation in the segment. Having completed one year at the helm of the regulator on March 1, Pandey said he would place a "very, very big focus" on strengthening the corporate bond market in his second year. He outlined plans to deepen secondary market liquidity, expand issuer participation and widen investor access.
He noted that the corporate bond market has already shown significant growth, with the outstanding amount reaching Rs 58 lakh crore from Rs 17 lakh crore previously, reflecting a 12 per cent CAGR. He highlighted that while corporate bonds were once 40 per cent of bank credit to industries, they now account for 60 per cent, signalling a shift in how Indian services and industries seek funding.Addressing the current regulatory stance on other segments, Pandey clarified that SEBI is not contemplating immediate changes to the derivative markets. "I have said before that we, when we as a regulator, we are looking at derivative markets in a very methodical manner and based on data and others and at this moment we are not contemplating any measures," he stated.
He added that the existing framework remains in place, and the regulator is maintaining a status quo while continuing to monitor data-driven developments.The Chairman also identified municipal bonds as a nascent but high-potential area for urban infrastructure financing. While 12 municipal bonds have been issued so far, Pandey described the current market as "next to negligible" compared to the requirements for urban development.