RBI bans JM Financial from lending against shares, debentures

JM Financial share price: JM Financial share price fell over 19% in the opening trade on Wednesday (March 7) after the Reserve Bank of India (RBI) barred JM Financial Products Ltd from giving loans against shares and debentures. The central bank cited regulatory and governance lapses following which JM Financial share fell as much as 19.29% to ₹77.10 apiece on the BSE.

JM Financial share price: JM Financial shares fell after RBI's action. Details below

Owing to the banking regulator's decision, JM Financial Products is barred from sanctioning and disbursing loans against Initial Public Offering (IPO) of shares.

RBI attributed its action to certain serious deficiencies observed with respect to loans sanctioned by the company. RBI said, “Apart from being in violation of regulatory guidelines, there are serious concerns on governance issues in the company, which in our assessment are detrimental to the interest of the customers."