Month: September 2021

7 Value Research Rated “5-Star Funds” To Start An SIP

Personal Finance

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5-Star rated funds from Value Research across categories

Type of fund 3-year returns (annualized) 5-year returns (annualized)
Canara Robeco Bluechip Equity Fund Largecap 19.99% 17.40%
Axis Bluechip Fund Largecap 18.94% 18.01%
Mirae Asset Largecap Largecap 16.73% 16.75%
Axis Small Cap Fund Small cap 30.76% 23.29%
Parag Parekh Flexi cap Flexi Cap 26.70% 23.12%
SBI Magnum Income Fund Debt Fund 9.95% 8.85%
HDFC Money Market Debt, Money Market 6.58% 6.62%

We have chosen just seven of the rated funds for SIPs

We have chosen just seven of the rated funds for SIPs

The list of 5-star rated funds is very exhaustive and we have chosen only a selective. There has been no criteria in out selection, but, only based on inclusiveness from the largecap, small cap, flexi cap and debt funds. We have just picked the 5-star rated funds from across categories from the ratings of Value Research and as indicated before the list is not inclusive of all 5-star rated funds from Value Research. It is not possible to include every fund and maybe in the future articles, we could cover them category wise.

May be prudent to start SIPs in debt as well

May be prudent to start SIPs in debt as well

With the Sensex on Friday hitting a new historic high of 59,732points, one wonders whether it makes sense to buy into equity even though it is SIP. There was a time one year back if you started an SIP you would have been doing well. To buy now at such high net asset value levels hardly makes sense. Advocates argue that SIPs are the best way to hedge risk, as you can average out should the market fall. That maybe partially true, but, if the markets keep falling for the next six months, you have been averaging out consistently at higher prices. If the markets can consistently be rising over the last 12-months, they can fall too.

In any case, we are advising caution to investors and even if you can start debt SIPs and get nominal returns, you can switch later to equity mutual funds, should there maybe a sharp fall in the markets.

With the Sensex trading at a 23% premium to long term averages in terms of price to earnings multiples, the markets are expensive. In any case, we have provided investors with the options to chose from debt and equity, should they consider to go through the SIP route.

Disclaimer:

Disclaimer:

The rating accorded to mutual funds are based on various parameters, including performance, liquidity etc. The mutual funds that have performed during a certain time in the past is not a guarantee of future performance. Note poor rated mutual funds may also perform well in case the market mood turns positive or the stocks or other securities invested into are performing good. Investing in stocks equity mutual funds is risky, we are not endorsing any funds. Greynium Information Technologies, the author and Value Research are not responsible for losses incurred based on the article.

GoodReturns.in



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PNB cuts repo-linked lending rate by 25 bps to 6.55%

Banking & Finance

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Punjab National Bank (PNB) on Friday said it has reduced its the repo-linked lending rate (RLLR) by 25 basis points (bps) to 6.55 per cent from 6.80 per cent earlier.

“The repo-linked lending rate (RLLR) has been changed from 6.80 per cent to 6.55 per cent, with effect from September 17, 2021 (Friday),” PNB said in a regulatory filing with the bourses.

This is expected to push retail lending as it comes ahead of the upcoming festival season.

The RLLR, which was introduced in October 2019, is a floating rate-based and is linked to the repo rate of the Reserve Bank of India (RBI).

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Fintech start-up Ezeepay plans to expand in Southern markets

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Ezeepay, a fintech start-up focussed on financial inclusion and promoting digital transactions in rural and semi-urban areas, is planning to expand its services in the southern market over the next few months, a senior official of the company said.

“After a survey, we found that companies are unable to take up their services in the rural markets of south India because of the language barrier but we have found a solution. For instance, in Odisha, we started our services by creating Ezeepay touch points with a network base of locally hired people,” Shams Tabrej, Founder and CEO, Ezeepay told BusinessLine.

“We are now expanding our presence in south India. To start with, we will hire 200 people (in the company’s role) in the five southern States. These employees will build our network base of agents and distributors. In the next 6 months, we are aiming to have over 50,000 members,” he added.

Doorstep Digital Services

Started in August 2018, the Delhi-based Ezeepay offers a range of banking and digital services to rural India including Aeps service, Aadhaar Pay, Money transfer, Micro ATM, Bank account opening. It also offers online utility services including mobile recharge, travel and hotel booking and LIC premium payment besides compliance services such as ITR filing, GST registration, MSME registration among other services.

Doorstep Digital Services (DDS) is the flagship product of Ezeepay under which it takes these digital services and banking products to the hinterlands of the country. It currently operates in Uttar Pradesh, Bihar, West Bengal, Madhya Pradesh and Jharkhand.

“We have a network of 1.78 lakh agents and distributors in the North. Our total business in the North, across all services, is about ₹800 crore. We aim to garner a monthly business of ₹500-600 crore in the southern market,” Tabrej said.

Ezeepay earns commission on each digital transaction, which is shared between the company and agents.

Target areas

Kottayam and Malappuram in Kerala, West Godavari, East Godavari and Kurnool in Andhra Pradesh, Mysuru, Belgaum and Bellary in Karnataka, Madurai, Tiruchirappalli and Vellore in Tamil Nadu and Mancherial, Nirmal and Sircilla in Telangana are some of the target areas in south for Ezeepay.

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NARCL will have negligible short-term impact for banks: Kotak Securities report

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The National Asset Reconstruction Company Ltd (NARCL),which is being put together by public sector banks and a few private sector banks to clean up their bad loans, will have negligible short-term impact as the upfront cash received is a smaller proportion and divided across banks, according to a Kotak Securities Ltd (KSL) report.

Government guarantee, aggregating ₹30,600 crore, to the cecurity receipts (SRs) to be issued by NARCL puts a 18 per cent floor on recovery rate, the report said.

The government guarantee on SRs can enable trading of these securities (that is converted into cash in secondary market).

“The upfront cash received, 15 per cent of the written-down value, will be reversed while the provisions for the balance (value of security receipts) are unlikely to be reversed even if it is fully provided.” said a team of six KSL analysts led by MB Mahesh.

As this cash is a smaller proportion and divided across public banks and a few private banks, the short-term impact is negligible, the analysts added.

They opined that larger release of provisions, if any, would be made as and when the cash is received on sale of these receipts or redemption of security receipts.

The analysts felt that banks are unlikely to reverse any provisions based on their discussions with these banks in the past on this topic.

They assessed that a 15:85 (cash: SR) structure implies that the ₹30,600 crore guarantee would translate to ₹36,000 crore of marked-down value of NPLs.

So, the ₹2 lakh crore of NPLs (non-performing loans) purchase value would imply 18 per cent recovery rate.

“Today, the NPL recognition and provisions cycle is largely complete with some of the largest bad loans already resolved.

“Banks have about 90-100 per cent (provision) coverage on these assets, implying there is no management incentive to delay decision making,”the analysts said.

The NPLs (written-off or otherwise) exchanged for security receipts are fully provided but the analysts don’t expect banks to reverse provisions.

Major benefit

The report emphasised that the major benefit of NARCL would accrue through faster debt consolidation, potentially leading to quicker decision making and better recovery rates.

Further, senior management bandwidth would be released on solving these problems, which can be channelized towards identifying fresh segments for growth that has been tepid in recent years.

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Fintech start-up IppoPay raises $250,000 in pre-seed funding

Banking & Finance

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IppoPay, a Chennai-based fintech start-up that provides digital payment solutions to merchants in tier-2 and tier-3 cities, has raised $250,000 in pre-seed funding from early-stage investor Better Capital along with Prabhu Rangarajan (co-founder of M2P) and Sailesh Ramakrishnan (partner at Rocketship VC).

In a statement, the company said it intends to use the proceeds to reach 100,000 merchants and expand its suite of offerings.

IppoPay claims that its platform has recorded transactions worth ₹1,750 crore in over one crore transactions for about 5,000 merchants. IppoPay is currently partnered with YES Bank, Axis Bank, ICICI Bank and Paytm Bank.

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Reserve Bank of India – Press Releases

Press Releases

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The Reserve Bank of India, in the public interest, had issued directions to Padmashri Dr. Vitthalrao Vikhe Patil Co-operative Bank Ltd., Nashik, Maharashtra in exercise of powers vested in it under sub-section (1) of Section 35 A read with Section 56 of the Banking Regulation Act, 1949 (AACS) from the close of business on May 19, 2018. These directions were modified from time to time, the validity of which was last extended up to September 17, 2021. These directions shall continue to apply to the bank for a further period of three months from September 18, 2021 to December 17, 2021, subject to review. The Directions stipulate certain restrictions and / or ceiling on withdrawal / acceptance of deposits. A copy of Directions is displayed at the bank’s premises for interested members of public to peruse. Reserve Bank of India may consider modifications of the Directions depending upon the circumstances. The issue of Directions should not per se be construed as cancellation of banking license by the Reserve Bank of India. The bank will continue to undertake banking business with restrictions till its financial position improves.

(Yogesh Dayal)     
Chief General Manager

Press Release: 2021-2022/883

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Reserve Bank of India – Press Releases

Press Releases

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1. Reserve Bank of India – Liabilities and Assets*
(₹ Crore)
Item 2020 2021 Variation
Sep. 11 Sep. 3 Sep. 10 Week Year
1 2 3 4 5
4 Loans and Advances          
4.1 Central Government – – – – –
4.2 State Governments 26615 10550 12260 1710 -14355
* Data are provisional.

2. Foreign Exchange Reserves
Item As on September 10,
2021		 Variation over
Week End-March 2021 Year
₹ Cr. US$ Mn. ₹ Cr. US$ Mn. ₹ Cr. US$ Mn. ₹ Cr. US$ Mn.
1 2 3 4 5 6 7 8
1 Total Reserves 4714298 641113 23515 -1340 495345 64129 731404 99453
1.1 Foreign Currency Assets 4256601 578879 23203 -934 332433 42186 598237 81358
1.2 Gold 276990 37669 -1063 -413 29267 3789 -2579 -351
1.3 SDRs 142930 19438 1017 1 132066 17952 132034 17956
1.4 Reserve Position in the IMF 37778 5127 358 5 1580 202 3712 490
*Difference, if any, is due to rounding off

4. Scheduled Commercial Banks – Business in India
(₹ Crore)
Item Outstanding
as on Aug. 27, 2021		 Variation over
Fortnight Financial year so far Year-on-year
2020-21 2021-22 2020 2021
1 2 3 4 5 6
2 Liabilities to Others            
2.1 Aggregate Deposits 15517046 -55253 609301 403534 1396596 1340253
2.1a Growth (Per cent)   –0.4 4.5 2.7 10.9 9.5
2.1.1 Demand 1790971 -5777 -79289 -70222 172080 253257
2.1.2 Time 13726075 -49476 688590 473756 1224516 1086996
2.2 Borrowings 238081 -1609 -36770 -5944 -71517 -34588
2.3 Other Demand and Time Liabilities 556523 -7941 -36299 -100085 35785 -10854
7 Bank Credit 10897463 8629 -154703 -52046 536005 681305
7.1a Growth (Per cent)   0.1 –1.5 –0.5 5.5 6.7
7a.1 Food Credit 68801 -3212 14177 7547 3550 2860
7a.2 Non-food credit 10828662 11841 -168880 -59592 532455 678446

6. Money Stock: Components and Sources
(₹ Crore)
Item Outstanding as on Variation over
2021 Fortnight Financial Year so far Year-on-Year
2020-21 2021-22 2020 2021
Mar. 31 Aug. 27 Amount % Amount % Amount % Amount % Amount %
1 2 3 4 5 6 7 8 9 10 11 12
M3 18844578 19328505 -77617 -0.4 848008 5.0 483927 2.6 1970881 12.6 1680533 9.5
1 Components (1.1.+1.2+1.3+1.4)                        
1.1 Currency with the Public 2751828 2830920 -23653 -0.8 233363 9.9 79092 2.9 500477 24.0 247809 9.6
1.2 Demand Deposits with Banks 1995120 1926054 -6090 -0.3 -78486 -4.5 -69066 –3.5 178527 12.1 266847 16.1
1.3 Time Deposits with Banks 14050278 14525375 -48131 -0.3 691675 5.5 475097 3.4 1282896 10.6 1159684 8.7
1.4 ‘Other’ Deposits with Reserve Bank 47351 46156 257 0.6 1456 3.8 -1195 –2.5 8982 29.0 6192 15.5
2 Sources (2.1+2.2+2.3+2.4-2.5)                        
2.1 Net Bank Credit to Government 5850374 6075960 -17417 -0.3 653377 13.2 225586 3.9 893089 18.9 462221 8.2
2.1.1 Reserve Bank 1099686 1191232 2805   22954   91547   80224   176086  
2.1.2 Other Banks 4750689 4884728 -20222 -0.4 630423 15.9 134039 2.8 812865 21.5 286135 6.2
2.2 Bank Credit to Commercial Sector 11668466 11608342 7985 0.1 -162407 -1.5 -60124 –0.5 587078 5.7 732105 6.7
2.2.1 Reserve Bank 8709 8616 -82   -1601   -93   3968   -2949  
2.2.2 Other Banks 11659757 11599726 8067 0.1 -160806 -1.5 -60031 –0.5 583110 5.7 735054 6.8

8. Liquidity Operations by RBI
(₹ Crore)
Date Liquidity Adjustment Facility MSF* Standing Liquidity Facilities Market Stabil isation Sch eme OMO (Outright) Long Term Repo Oper ations& Targeted Long Term Repo Oper ations# Special Long-Term Repo Operations for Small Finance Banks Special Reverse Repo£ Net Injection (+)/ Absorption (-) (1+3+5+6+ 9+10+11+ 12-2-4- 7-8-13)
Repo Reverse Repo* Variable Rate Repo Variable Rate Reverse Repo Sale Purchase
1 2 3 4 5 6 7 8 9 10 11 12 13 14
Sep. 6, 2021 – 684223 – – 30 – – – – – – – – -684193
Sep. 7, 2021 – 627660 – 50008 17 – – – – – – – – -677651
Sep. 8, 2021 – 594572 – – 34 –1600 – – – – – – – -596138
Sep. 9, 2021 – 481121 – 350015 13 – – – – – – – 9450 -840573
Sep. 10, 2021 – 67472 – – 527 – – – – – – – – -66945
Sep. 11, 2021 – 12062 – – 279 – – – – – – – – -11783
Sep. 12, 2021 – 2513 – – 3 – – – – – – – – -2510
* Includes additional Reverse Repo and additional MSF operations (for the period December 16, 2019 to February 13, 2020).
# Includes Targeted Long Term Repo Operations (TLTRO) and Targeted Long Term Repo Operations 2.0 (TLTRO 2.0) and On Tap Targeted Long Term Repo Operations. Negative (-) sign indicates repayments done by Banks.
& Negative (-) sign indicates repayments done by Banks.
£ As per Press Release No. 2021-2022/177 dated May 07, 2021. From June 18, 2021, the data also includes the amount absorbed as per the Press Release No. 2021-2022/323 dated June 04, 2021.

The above information can be accessed on Internet at https://wss.rbi.org.in/

The concepts and methodologies for WSS are available in Handbook on WSS (https://rbi.org.in/scripts/PublicationsView.aspx?id=15762).

Time series data are available at https://dbie.rbi.org.in

Ajit Prasad
Director   

Press Release: 2021-2022/882

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This Government Company Offers Up To 8% Interest On FD: Should You Invest?

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Tamil Nadu Transport Development Finance Corporation Ltd

Tamil Nadu Transport Development Finance Corporation Limited (TTDFC), is a wholly-owned non-banking finance company of the Government of Tamil Nadu. This government-owned company offers two types of attractive deposit schemes to the investors such as Period Interest Payment Scheme (PIPS) and Money Multiplier Scheme (MMS). Interest is paid monthly, quarterly, or yearly under PIPS, and the minimum deposit amount approved is Rs.50,000/-. Alternatively, under the Money Multiplier Scheme (MMS), interest is compounded quarterly at the prevailing rate and the minimum amount of money that can be deposited is Rs.50000.

TTDFC’s website is straightforward and easy to browse for investors. All operations, from opening a deposit account to withdrawing funds, are undertaken electronically. The TTDFC fixed deposit offers multiple benefits such as loan facility is available up to 75% of the deposit amount, nomination facilities are available subject to the provisions of the RBI, renewal of deposits, primary / joint account opening option, repayment of deposits on maturity, premature withdrawal option and much more.

Premature withdrawal

Premature withdrawal

After three months have passed after the deposit, no premature withdrawals are permitted. Premature withdrawals made after three months but before the end of the six-month period, will not be charged any interest. Premature withdrawals after 6 months will be charged 2% less interest than the rate for a 12-month of deposit. In the event of a premature withdrawal after 12 months, interest will be paid at a rate that is 1% lower than the rate at the maturity date. The deposit amount shall be repaid prematurely to the surviving depositor, in case of death of the primary account holder. If the deposit is requested to be closed prematurely, the depositors must provide at least 1-week prior notice, according to the company’s terms & conditions policy.

Interest Rates of TTDFC FD

Interest Rates of TTDFC FD

With effect from 18.01.2021, interest rates on fixed deposit schemes of Tamil Nadu Transport Development Finance Corporation Limited are in force. Below are the most recent interest rates on the Period Interest Payment Scheme and Money Multiplier Scheme of the company.

Scheme – I PERIODIC INTEREST PAYMENT SCHEME

Others In % In % In % Senior Citizen In % In %
Period Monthly Quarterly Annually Monthly (%) Quarterly (%) Annually (%)
24 – 7.25% – – 7.50% –
36,48 7.75% 7.75% 7.98% 8.25% 8.25% 8.51%
60 8.00% 8.00% 8.24% 8.50% 8.50% 8.77%
Source: https://www.tdfc.in

Money Multiplier Scheme (MMS)

Others Senior Citizen
Period (Months) Basic Rate P.A (%) Effective Yield P.A (%) Basic Rate P.A (%) Effective Yield P.A (%)
12 7 7.19 7.25 7.45
24 7.25 7.73 7.5 8.01
36 7.75 8.63 8.25 9.25
48 7.75 8.99 8.25 9.66
60 8 9.72 8.5 10.46
Source: https://www.tdfc.in

Should you invest?

Should you invest?

As the Transport Development Finance Corporation Limited (TTDFC), is wholly owned by the Government of Tamil Nadu, the risk of your deposit is thus minimized. And apart from the deposit safety, the corporation is also promising an interest rate of 8% in the long-term and even a pretty good rate of 7% in the short term which is a maturity period of 12 months.

In the current scenario where leading banks such as SBI, Axis Bank, HDFC Bank, ICICI Bank are offering an interest rate around 5.30% to 5.40%, investing in the fixed deposit scheme of TTDFC can be a smart move. The interest rates of the company are uncomparable as of now with any other banks, even small finance banks. Interest rates of both short-term and long-term deposits of TTDFC are very attractive, but here we suggest investors invest for short-term to counter interest rate risk against their deposit.

The reason behind my take is, currently all the major banks are offering low-interest rates due to record low key policy rates of RBI. And if the economy climbs in the near future and interest rates go up, then you will not get the benefit of higher interest rates, as you had locked in your deposit at the contracted rates. By investing for the short term you would not only avoid interest risk but also interest penalty on premature withdrawal on long-term deposits.

Apart from this risk, investors should also keep their eyes on the rising inflation which may give them returns less than the rate of inflation, if they are in the tax bracket of 30 per cent. So to earn higher returns from your FDs at TTDFC, it is better to invest for short term, and if investing for long-term then diversification across secure debt instruments or equity funds is a must to beat inflation resulting to earn risk-adjusted returns.



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Bad Bank to solve Rs 2 lakh crore bad loans, take NPAs off banks’ books; here’s how it will work

Banking & Finance

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Finance Minister Nirmala Sitharaman on Thursday announced that the Union government will guarantee Rs 30,600 worth of security receipts issued by the National Asset Reconstruction Company.

The Bad Bank is finally here, after a decade of discourse. It aims to help clean up banks’ books by taking over Rs 2 lakh crore bad loans. If it works as intended, Bad Bank may help cut system-wide bank NPAs (non-performing assets) by over 1%, and help recover some of bad debts too, analysts say. The National Asset Reconstruction Company (NARCL), as it is officially named, will acquire banks’ bad debt to resolve or liquidate. It will buy these stressed assets for a mix of cash, and government-guaranteed security receipts.

Finance Minister Nirmala Sitharaman on Thursday announced that the Union government will guarantee Rs 30,600 worth of security receipts issued by the National Asset Reconstruction Company (NARCL). “NARCL will acquire stressed assets through 15% cash payment to banks based on valuation and the rest 85% will be given as security receipts,” Nirmala Sitharaman said. The government-backed security receipts can only be invoked on resolution or liquidation.

What is NARCL? Why is it needed?

The National Asset Reconstruction Company (NARCL) was proposed by the Finance Minister in her Union Budget speech. NARCL, popularly known as Bad Bank, will function as an asset reconstruction company set up by banks to resolve stressed assets for smoother functioning. Public sector banks will have 51% ownership in NARCL. The bad bank intends to resolve stressed loan assets above Rs 500 crore each.

How the Bad Bank will work

Bad loan transfer: NARCL will take over bad loans worth Rs 2 lakh crore from banks, of which Rs 90,000 crore will be taken over in the first phase. The Ministry of Finance said that NARCL will acquire bad loans from banks for a mutually agreed-upon value (understandably, a net value after a haircut). NARCL will pay 15% of the agreed net value of the bad debt upfront in cash and the remaining 85% in form of security receipts. The banks would use this 15% cash upfront to reverse the debt write down. As for the security receipts for the remaining 85%, the bank would redeem those when the bad bank resolves or liquidates the bad debt; or, the bank may also trade these securities for cash.

Provision write-back: “These loans are fully provided in the books of the bank. The upfront cash received, 15% of the written-down value, would be reversed while the provisions for the balance (value of security receipts) are unlikely to be reversed even if it is fully provided,” analysts at Kotak Securities wrote in a note. “The larger release of provisions, if any, would be made as and when the cash is received on sale of these receipts or redemption of security receipts. The government guarantee on SRs can enable trading of these securities,” Kotak Securities added.

Government guarantee: The security receipts issued by NARCL are backed by the Union government guarantee. The government guarantee will cover any shortfall between the face value of the receipts and the actual realisation value of the bad loan.

Resolution is key

“How efficiently the professionals are resolving the stressed assets is to be monitored. One can argue that bad bank is likely to become a warehouse for stressed loans without expected recovery as it will be difficult to find buyers for legacy assets,” ICICI Securities said in a note. The Resolution of the proposed Rs 2 lakh crore of legacy stressed assets will lower GNPLs (gross non performing loans) by more than 2%, the note said. The estimated realisable value of 18% will lead to provisioning write-back of Rs 36,000 crore. “Through successful execution of phase-1, one can expect near term NPA reduction of >1% and NPA recoveries equivalent to 10bps of system credit,” ICICI Securities said.

Why is government guarantee needed?

The government said that resolution mechanisms of dealing with a backlog of NPAs typically require a backstop from the Government. “This imparts credibility and provides for contingency buffers. Hence, a Government Guarantee of up to Rs 30,600 crore will back Security Receipts (SRs) issued by NARCL. The guarantee will be valid for 5 years. The condition precedent for invocation of guarantee would be resolution or liquidation,” the finance ministry said.

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Reserve Bank of India – Press Releases

Press Releases

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The following State Governments have offered to sell securities by way of auction, for an aggregate amount of ₹8,901 Cr. (Face Value).

Sr. No. State/UT Amount to be raised
(₹ Cr)		 Additional Borrowing (Greenshoe) Option (₹ Cr) Tenure (Yrs) Type of Auction
1 Andhra Pradesh 500 – 14 Yield
500 – 19 Yield
2 Kerala 500 – 14 Yield
3 Madhya Pradesh 2000 – Re-issue of 6.85% Madhya Pradesh SDL 2031 Issued on September 15, 2021 Price
4 Maharashtra 2500 – Re-issue of 6.78% Maharashtra SDL 2031 Issued on May 25, 2021 Price
5 Nagaland 150 – 10 Yield
6 Rajasthan 1000 – 10 Yield
500 – 15 Yield
7 Sikkim 251 – 10 Yield
8 Tamil Nadu 1000 – 10 Yield
  TOTAL 8901      

The auction will be conducted on the Reserve Bank of India Core Banking Solution (E-Kuber) system on September 21, 2021 (Tuesday). The Government Stock up to 10% of the notified amount of the sale of each stock will be allotted to eligible individuals and institutions subject to a maximum limit of 1% of its notified amount for a single bid per stock as per the Scheme for Non-competitive Bidding Facility.

Both competitive and non-competitive bids for the auction should be submitted in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system on September 21, 2021 (Tuesday). The non-competitive bids should be submitted between 10.30 A.M. and 11.00 A.M. and the competitive bids should be submitted between 10.30 A.M. and 11.30 A.M.

In case of technical difficulties, Core Banking Operations Team (email; Phone no: 022-27595666, 022-27595415, 022-27523516) may be contacted.

For other auction related difficulties, IDMD auction team can be contacted (email; Phone no: 022-22702431, 022-22705125).

Only in the event of system failure, physical bids would be accepted. Such physical bids should be submitted to the Public Debt Office (email; Phone no: 022-22632527, 022-22701299) in the prescribed form obtainable from RBI website (https://www.rbi.org.in/Scripts/BS_ViewForms.aspx) before the auction timing ends.

The yield percent per annum expected by the bidder should be expressed up to two decimal points. An investor can submit more than one competitive bid at same/different rates of yield or prices in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system. However, the aggregate amount of bids submitted by a bidder should not exceed the notified amount for each State.

The Reserve Bank of India will determine the maximum yield /minimum price at which bids will be accepted. Securities will be issued for a minimum nominal amount of ₹10,000.00 and multiples of ₹10,000.00 thereafter.

The results of the auction will be announced on September 21, 2021 (Tuesday) and payment by successful bidders will be made during banking hours on September 22, 2021 (Wednesday) at Mumbai and at respective Regional Offices of RBI.

The State Government Stocks will bear interest at the rates determined by RBI at the auctions. For the new securities, interest will be paid half yearly on March 22 and September 22 of each year till maturity. The Stocks will be governed by the provisions of the Government Securities Act, 2006 and Government Securities Regulations, 2007.

The investment in State Government Stocks will be reckoned as an eligible investment in Government Securities by banks for the purpose of Statutory Liquidity Ratio (SLR) under Section 24 of the Banking Regulation Act, 1949. The stocks will qualify for the ready forward facility.

Ajit Prasad
Director   

Press Release: 2021-2022/881

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