Longer trading hours not to affect banks

MUMBAI: Brokers will have to deposit more money with stock exchanges and organise additional funding from banks once the trading hours are extended.

Bankers say that longer trading hours will make very little difference to their life as they are already coping with commodity futures trading which go on till 11pm.

A senior official of a leading clearing banker told ET that the recent Sebi fiat means that brokers will have to keep additional margin money with the exchanges or clearing banks.

According to Edelweiss CMD Capital Rashesh Shah, ���There is no denying that there will be an increase in working capital. But if there is a corresponding increase in trading volumes, brokers will not mind it.���

Understandably, brokers will have to approach their banks for hiking the overdraft limits to meet quick payment obligations. Brokers feel the funding need may go up by at least 10%.

The Real Time Gross Settlement System ��� a mechanism that enables brokers and corporates to quickly transfer money within the same day ��� is open between 9 am to 4.30 pm. However, banks do not accept customer requests for transfers post 3.30-4pm.

Banks have asked RBI for extending the RTGS timing till 5pm. If this is executed, the impact on brokers would be minimal. ���It is a positive move as it will enable the markets to catch more news flow and the off-market volatility will come down,��� said Abhay Aima, country head private banking and third-party products, HDFC Bank.