NSE vice chairman Ravi Narain resigns

Ravi Narain, one of the founding members of National Stock Exchange, has put in his papers as vice-chairman and board member as a probe by Securities and Exchange Board of India (Sebi) into allegations of preferential access to some brokers to its trading platform gathered pace.

The resignation which was sent to NSE chairman Ashok Chawla on Thursday night comes after the capital markets regulator issued a show-cause notice last week to the exchange and its 14 officials, including Narain, regarding the findings of a Sebi panel. There was also the report of a forensic probe by Deloitte on the co-location and algorithmic trades issues. They had been given three weeks to respond.

The NSE board will consider Narain's resignation and discuss issues related to the case during its meeting next week.

According to a Times of India report which quoted NSE sources, Narain was keen to ensure his presence was not a hurdle and that the board was able to take independent decisions on the co-location issue.

This comes as the second high-profile exit from the exchange in six months after the resignation of Chitra Ramkrishna as CEO on 2 December.

According to a Sebi investigation report, the exchange granted preferential access to some stock brokers to its servers, which made it possible for them to log into multiple servers through multiple internet protocols that had been assigned to them. The events happened between 10 December 2012, and 30 May 2014.

The exit of Narain comes five months after Chitra Ramkrishna, MD and CEO of the NSE, resigned for ''personal reasons'' in December 2016.

Sebi had been probing the role of a number of top NSE officials in the high frequency trading - algorithmic trading or algo in market parlance which referred to orders generated at a superfast speed by use of advanced mathematical models involving automated execution of trade while co-location involved setting up servers on the exchange premises.