JM Financial Limited said on October 18 that the Reserve Bank of India has lifted restrictions from its subsidiary JM Financial Products Ltd from financing against shares and debentures.
"With this communication, the company is permitted to provide, with immediate effect, the financing against shares and debentures in compliance with all applicable laws and regulations," JM Financial said in an exchange filing. "The company is committed to upholding the highest standards of compliance and will continue to ensure that the remediations carried out by it are sustained."
In March, the RBI had barred JM Financial Products Ltd (JMFPL) from giving loans against shares and debentures, including sanction and disbursal of loans against Initial Public Offering (IPO) of shares, with immediate effect.
The action was taken after observing certain serious deficiencies in the financial services firm's loan process, the RBI had said. More importantly, the central bank highlighted that there are serious concerns on the governance issues in the company, apart from violation of regulatory guidelines.
In an exclusive interview to Moneycontrol on July 22, Vishal Kampani, non-executive vice chairman, JM Financial, had said the firm was working with the regulator, provided data and was expecting an early resolution to the issue.
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