New Delhi, Sept. 11 -- Fearing a rush of redemption requests from investors in debt mutual funds as companies default on repayments, the markets regulator has allowed asset managers to side-pocket their exposures to entities that have approached them to restructure their debt.
Under the temporary rules that will be effective till the end of the year, asset management companies (AMCs) can side-pocket higher-rated debt and not just those below investment grade, the Securities and Exchange Board of India (Sebi) said in a circular issued on 2 September.
Side-pocketing was earlier allowed if there was a default or the debt was downgraded below investment grade.
The regulator is trying to help MFs deal with the turmoil caused by the pandemic a...