SEBI Chairman Ajay Tyagi has called for a gradual elimination of regulatory arbitrage between banks loans and corporate bonds. He wants banks should disclose defaults in corporate loans, similar to the system in place for corporate bonds, saying it was an issue that regulators would need to address. He also pushed for a reduced reliance on bank loans and instead said more such financing should be provided through corporate bonds. Tyagi said that the large (bond market) exposures framework of RBI, which was announced last year is a step in the right direction but its effectiveness is yet to be measured. "HNIs also own fixed-income assets and park surplus in them but lack of funding against these assets has restricted their ability to invest in the segment. Loan against shares is available but loan against corporate bonds or government security is hard to get. "Allowing them to borrow and lend in this segment could get their interest in this asset class."