BSE Calls Off Merger Of IFSC Stock Exchanges

India INX, the arm of BSE, has called off the proposed merger and has conveyed the same to NSE IX. The BSE arm will compete and complement the NSE IX at the IFSC, a senior executive aware of the development told NDTV Profit on the condition of anonymity.

The GIFT City arm of BSE will compete and complement like it does in the domestic market against the National Stock Exchange, the person quoted above said.

Currently, both exchanges have similar equity derivative products that compete for the same liquidity pool.

NSE IX has moved the offshore liquidity, based out of Singapore, to IFSC through the NSE IFSC Connect with the Singapore Exchange.

The IFSCA, or the International Financial Centres Authority—the regulator for entities based out of GIFT City—had mooted the proposal in August 2022 for the proposed merger.

The regulator wanted to ensure that the offshore liquidity for Indian products to India is not split, and further, such consolidation could also bring cost-efficiency and capital conservation for the stock exchanges that are currently capitalising their IFSC subsidiaries.

The move would have required a sign-off from the Finance Ministry over and above approval from the market regulator, the Securities and Exchange Board of India and the banking regulator, the Reserve Bank of India, in addition to changes and clarifications to existing laws such as the Companies Act.

BSE spokesperson confirmed to NDTV Profit that the exchange is discontinuing the merger discussion. The spokesperson for NSE did not respond to queries.

* Updates for BSE comments