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No payment crisis; TGF not touched, says CSE chief

Rifat Jawaid in Calcutta

Even as the settlement payment problem at the Calcutta Stock Exchange triggered a sharp fall in Indian shares on Friday, the Calcutta Stock Exchange president Kamal Parekh affirmed: "There is no crisis. The payment is delayed, but the payment is on."

Parekh said that there was a shortfall of about Rs 900-950 million. Of this, Rs 510 million had already been cleared by the brokers, he added.

Speaking to rediff.com the CSE president expressed optimism that the crisis would be resolved by Friday evening.

He also assured that the Trade Guarantee Fund had not been touched by the Calcutta bourse. "The TGF is used as the last resort. Fortunately, despite the bank holiday we were not required to do so," he said. He also said that the security deposit of two defaulters (cash and stock) had been used for margin settlement.

"We expect more payments to come by late Friday evening. So we will know only later whether there is actually a payments default. Right now what is happening is a postponement of the pay-in," another CSE official earlier said.

Parekh said payments were delayed by a day because Friday was a public holiday in Calcutta on account of Holi, the Hindu festival of colours.

"One problem is that the banks are closed here. We are in touch with the banks in Bombay," Parekh said.

CSE officials said some payments were merely delayed and, in any event, the bourse had enough reserves to cover the shortfall.

Meanwhile, brokers lambasted the bourse authorities over what they termed as slack surveillance. They also felt that the crisis had been blown out of proportion.

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