SEBI tightens disclosure norms for municipal bonds

The Securities and Exchange Board of India has prescribed wider disclosure and compliance norms to be followed by the issuers of listed municipal bonds. Such listed entities are required to prepare and submit half-yearly unaudited financial results to the stock exchanges within 45 days of the end of the first half of the year. They also need to submit annual audited financial results for the financial year, within 60 days from the end of the fiscal year along with the audited report. The listed entities will also have to submit a certificate to the stock exchange intimating the status of payment of interest or principal or both within five working days of the same becoming due in respect of municipal debt securities. Every credit rating of such issuers will be reviewed at least once a year by a registered credit rating agency. Any change in the credit rating will be promptly disseminated on the stock exchanges where the securities are listed.

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