The NSE-owned clearing corporation stopped functioning and ensured all brokers who clear through them couldn’t place orders on BSE," a spokesperson for BSE said in an email. With the interoperability function, trading members can use collateral posted with the clearing corporation of one exchange to trade on another. But note that trading was halted on NSE because of troubles at NCL and not the other way around. But to rule out the possibility of members using BSE’s actively functioning clearing corporation to trade on NSE isn’t an exchange’s call to make. In this case, since BSE Clearing was functioning, NSE trading could have been kept on," says J.R. Varma, a professor of finance at IIM-Ahmedabad and a former Sebi whole-time member.

Source: Mint February 25, 2021 23:47 UTC