The permission to the clearing houses of the exchanges to open a transitory pooling account with the RBI is the first step taken to provide an environment for an efficient and safe settlement system. Draft guidelines for allowing repos in corporate bonds will be placed shortly on RBI’s website for wider dissemination and comments.
That’s the easier part; the difficult part is to find viable alternatives – the rating agencies were part of a big machine that was working well as long as the going was good. Obviously, any alternative framework has to be in sync with the changed realities of the market. Its will not be possible to think of any changes in this regard in isolation.