RBI-Auction of Sixteen State Government Securities for ` 15450 crore on December 23, 2014
December, 20th 2014
The following sixteen State Governments have offered to sell 10 year securities by way of auction for an aggregate amount of ` 15450 crore (Face Value). The State-wise break up is as follows:
Amt to be raised (` crore)
*Uttar Pradesh and Tamil Nadu will have option to retain additional subscription of ` 250 cr each
The auction will be conducted on the Reserve Bank of India Core banking Solution (E-Kuber) system on 23 December, 2014 (Tuesday). The Government Stock up to 10 % of the notified amount of the sale of each of the 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 (available on RBI website).
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 23 December, 2014 (Tuesday). The non-competitive bids should be submitted between 10.30 A.M. and 11.30 A.M. and the competitive bids should be submitted between 10.30 A.M. and 12.00 noon.
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 different 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 there after.
The results of the auction will be announced on 23 December, 2014 (Tuesday) and payment by successful bidders will be made during banking hours on 24 December, 2014 (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. Interest will be paid half yearly on June 24 and December 24 of each year till maturity for all states. 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.