Role and Functions of Bankers to issue

Bankers to issue (BTI) are financial institutions that act as intermediaries in the process of issuing securities to the public. They play a crucial role in the primary market by facilitating the issuance of securities and ensuring that the process is conducted in a fair and transparent manner. In India, BTIs are regulated by the Securities and Exchange Board of India (SEBI) and are required to comply with several guidelines and regulations.

Role of Bankers to Issue:

The role of BTIs can be broadly classified into two categories: pre-issue activities and post-issue activities.

Pre-issue activities:

• Due diligence: BTIs are required to conduct due diligence on the issuer and ensure that all the information provided by the issuer is accurate and complete.
• Pricing of the issue: BTIs are responsible for pricing the issue and ensuring that the pricing is fair and transparent.
• Marketing of the issue: BTIs are responsible for marketing the issue to potential investors and ensuring that the issue is subscribed to the desired extent.
• Collection of applications: BTIs are responsible for collecting the applications from the investors and ensuring that they are processed in a timely and efficient manner.

Post-issue activities:

• Allotment of securities: BTIs are responsible for allotting the securities to the investors and ensuring that the allotment is done fairly and transparently.
• Refund of excess subscription: BTIs are responsible for refunding the excess subscription amount to the investors in case the issue is oversubscribed.
• Listing of securities: BTIs are responsible for getting the securities listed on the stock exchange and ensuring that the listing is done in a timely and efficient manner.
• Transfer and transmission of securities: BTIs are responsible for facilitating the transfer and transmission of securities and ensuring that the process is conducted in a fair and transparent manner.

Functions of Bankers to Issue:

• Compliance with SEBI guidelines: BTIs are required to comply with the guidelines issued by SEBI regarding the issuance of securities. These guidelines ensure that the issuance process is fair and transparent and that investors are adequately protected.
• Coordination with other intermediaries: BTIs are required to coordinate with other intermediaries, such as underwriters and registrars, to ensure that the issuance process is conducted smoothly.
• Facilitation of payments: BTIs are responsible for facilitating the payment process and ensuring that the investors receive their allotted securities in a timely manner.
• Risk management: BTIs are required to implement a robust risk management framework to identify, assess, monitor, and manage the various risks associated with the issuance process.
• Investor grievance redressal: BTIs are required to establish a robust investor grievance redressal mechanism to ensure that the investors’ grievances are resolved in a timely and efficient manner.