Description

SEBI mandates trustees of special purpose distinct entities to submit half-yearly disclosures for SDIs to the Board and stock exchanges within 30 days from end of March or September, effective March 31, 2026.

Summary

SEBI has mandated periodic disclosure requirements for Securitised Debt Instruments (SDIs) under Regulation 11B of SEBI (Issue and Listing of Securitised Debt Instruments and Security Receipts) Regulations, 2008. Trustees of special purpose distinct entities must submit half-yearly disclosures to SEBI and stock exchanges where SDIs are listed, within 30 days from the end of March or September. The circular provides detailed disclosure formats in Annexure I (for SDIs backed by loan/listed debt securities/credit facility exposures) and Annexure II (for SDIs backed by other exposures), along with calculation illustrations in Annexure III.

Key Points

  • Trustees of special purpose distinct entities must submit half-yearly disclosures to SEBI and stock exchanges
  • Submission deadline: Within 30 days from end of March or September
  • Two separate disclosure formats provided based on underlying asset type
  • Annexure I covers SDIs backed by loan/listed debt securities/credit facility exposures
  • Annexure II covers SDIs backed by other exposures
  • Annexure III provides calculation illustrations for weighted average maturity, weighted average rating, and average default rate
  • Circular issued under Section 11(1) of SEBI Act, 1992 read with Regulation 11B and 48 of SDI Regulations

Regulatory Changes

SEBI has operationalized Regulation 11B of the SDI Regulations by specifying the manner and format for periodic information disclosure. The regulation previously mandated half-yearly disclosures but lacked detailed specification. This circular now provides:

  • Standardized disclosure formats (Annexures I and II)
  • Specific submission timeline (30 days from period end)
  • Clear categorization based on underlying asset types
  • Detailed disclosure parameters including maturity characteristics, Minimum Retention Requirement (MRR), credit quality, performance metrics, and ratings information
  • Calculation methodologies through illustrative examples

Compliance Requirements

Applicable to: Special purpose distinct entities and their trustees involved in SDI issuance

Disclosure Requirements:

For SDIs backed by loan/listed debt securities/credit facility exposures (Annexure I):

  1. Maturity characteristics: Weighted average maturity and maturity-wise distribution
  2. Minimum Retention Requirement (MRR): MRR percentage, actual retention, types of retained exposure
  3. Credit quality of underlying exposures: Distribution of overdue exposures
  4. Performance metrics and other relevant information

For SDIs backed by other exposures (Annexure II):

  • Separate disclosure format as specified

Submission Process:

  • File disclosures with SEBI
  • File disclosures with stock exchange(s) where SDIs are listed
  • Maintain accuracy and completeness of information
  • Use prescribed calculation methodologies from Annexure III

Important Dates

  • Circular Date: December 16, 2025
  • Effective Date: March 31, 2026
  • Disclosure Periods: Half-yearly (ending March 31 and September 30)
  • Submission Deadline: Within 30 days from end of each half-year period (by April 30 and October 30)

Impact Assessment

Market Impact:

  • Enhanced transparency in the securitisation market
  • Improved investor protection through regular disclosure of asset performance
  • Standardized reporting framework enabling better comparison across SDI transactions
  • Increased market confidence in securitised debt instruments

Operational Impact:

  • Trustees and special purpose entities need to establish half-yearly reporting processes
  • Data collection and computation systems required for MRR calculations, maturity analysis, and credit quality metrics
  • Compliance teams must ensure 30-day deadline adherence
  • Initial implementation effort required before March 31, 2026 effective date
  • Ongoing monitoring of underlying asset performance and retention requirements

Regulatory Impact:

  • Strengthens SEBI’s oversight of securitisation market
  • Aligns with global best practices for structured finance disclosure
  • Facilitates early identification of stress in securitised portfolios
  • Creates audit trail for regulatory supervision

Impact Justification

Introduces mandatory half-yearly disclosure framework for SDI trustees affecting all securitisation transactions, requiring significant operational compliance changes for special purpose entities and trustees with strict 30-day submission deadlines.