Expert Committee Submits its Report on Determining Methodology for Fixing National Minimum Wage, Ministry of Labour and Employment Click here

Repo Rate and Reverse Repo Rate

From Arthapedia
Jump to: navigation, search

Repurchase Options or in short Repo, is a money market[1] instrument, which enables collateralised short term borrowing[2] and lending through sale/purchase operations in debt instruments. This is an instrument used by the Central Bank and banking institutions to manage their daily / short term liquidity.

Legal Definition

A legal definition of 'repo' and 'reverse repo' was inserted as sub-sections (c) and (d) of section 45 U of Chapter III D of the Reserve Bank of India (RBI) Act, 1934, vide The Reserve Bank of India (Amendment) Act, 2006 (w.e.f. 9.1.2007). Thus,

This is the general definition of Repo and Reverse Repo in India. The securities transacted here can be either government securities or corporate securities or any other securities which the Central bank permits for transaction. Non-sovereign securities are used in many global markets for repo operations. Unlike them, Indian repo market predominantly uses sovereign securities, though repo is allowed on corporate bonds and debentures.

Thus, based on the securities used, a narrow definition for repo and reverse repo is also provided in Sub Section 12AB of Section 17 of the RBI Act in respect of the Liquidity Adjustment Facility (LAF) conducted by the Reserve Bank of India wherein only sovereign securities (not corporate securities) are used for infusing /sucking liquidity from the market. This section was inserted vide the same Reserve Bank of India (Amendment) Act, 2006 (w.e.f. 9.1.2007).

Sub-section (12AB) of section 17 of the RBI Act, 1934, defines

"repo" as "an instrument for borrowing funds by selling securities of the Central Government or a State Government or of such securities of a local authority as may be specified in this behalf by the Central Government or foreign securities, with an agreement to repurchase the said securities on a mutually agreed future date at an agreed price which includes interest for the funds borrowed".

"reverse repo" means an instrument for lending funds by purchasing securities of the Central Government or a State Government or of such securities of a local authority as may be specified in this behalf by the Central Government or foreign securities, with an agreement to resell the said securities on a mutually agreed future date at an agreed price which includes interest for the funds lent."

Structure of Repo and Reverse Repo

The Repo transaction, as adopted in India, has two legs:- in the first leg seller sells securities and receives cash while the purchaser buys securities and parts with cash. In the second leg, securities are repurchased by the original holder. He pays to the counter party the amount originally received by him plus the return on the money for the number of days for which the money was used by him, which is mutually agreed. All these transactions are reported on the electronic platform called the Negotiated Dealing System (NDS). The Clearing Corporation of India Ltd. (CCIL), has put in an anonymous online repo dealing system in India, thereby moving the telephonic over the counter trading to an anonymous order matching electronic platform.


Source: Golakanath (2013)

The duration between the two legs is called the ‘repo period’. Predominantly, repos are undertaken on overnight basis, i.e., for one day period. The consideration amount in the first leg of the repo transactions is the amount borrowed by the seller of the security. On this, interest at the agreed ‘repo rate’ is calculated and paid along with the consideration amount of the second leg of the transaction (this amount need not be the same as that in the first leg) when the borrower buys back the security. Settlement of repo transactions happens along with the outright trades in government securities.

In the first leg of the transaction, sale price of securities is usually based on the prevailing market price for outright deals. As the ownership of securities passes on from seller to buyer for the repo period, legally the coupon interest accrued for the period has to be passed on to the buyer. Hence, in the second leg happening on the future date, the price will be structured based on the funds flow of interest and tax elements of funds exchanged.

When repo rate is higher than current yield, repurchase price will be adjusted upward signifying a capital loss. If the repo rate is lower than the current yield, then the repurchase price will be adjusted downward signifying a capital gain. If the repo rate and coupon are equal, then the repurchase price will be equal to the sale price of security.

Repo is thus, a money market instrument combining elements of two different types of transactions viz., lending-borrowing and sale-purchase. A repo is also called a ready forward transaction as it is a means of funding by selling a security held on a spot (ready) basis and repurchasing the same on a forward basis.

The reverse of the repo transaction is called ‘reverse repo’. In a reverse repo transaction, the securities should be purchased in the first leg at prevailing market prices and sold in the second leg at the derived/calculated prices. When the reverse repurchase transaction matures, the counterparty returns the security to the entity concerned and receives its cash along with a profit spread. One factor which encourages an organisation to enter into reverse repo is that it earns some extra income on its otherwise idle cash.

Whether a transaction is a repo or a reverse repo is determined only in terms of who initiated the first leg of the transaction. In other words, a transaction is called a repo when viewed from the perspective of the supplier of the securities (the party acquiring funds) and a reverse repo when described from the point of view of the supplier of funds.

Buy-Sell Repo used in India Vs Ordinary Collateralised lending

Repos are hybrid transactions since they combine features of both secured loans and outright purchase and sale transactions, but they do not fit cleanly into either of these classifications. The use of margin/haircut[3] in valuing repo securities, the right of repo borrowers to substitute collateral in term agreements, and the use of mark-to-market provisions (process of accounting the value of a security based on its current market price rather than its book value) are examples of repo features that typically are characteristics of secured lending arrangements but are rarely found in outright purchase and sale transactions. The repo buyer's right to trade the securities during the term of the agreement, by contrast, represents a transfer of ownership that typically does not occur in collateralized lending arrangements.

Since repos are attached with a repurchase agreement it makes the repo instrument less risky as there is no doubt about the liquidity of the security given as collateral since the borrower himself is willing to buy back the security.

Repo transactions have mostly replaced the non-collateralised borrowing (call loans) in the market.

Types of Repos based on Maturity

There are basically four types of repos based on its maturity period.

Indian Repo market is predominantly an overnight repo market.

Since October 2013[4], the Reserve Bank has introduced Term Repo under the Liquidity Adjustment Facility (LAF) for 14 days and 7 days tenors for banks (scheduled commercial banks other than RRBs) in addition to the existing daily LAF (repo and reverse repo) and Marginal Standing Facility (MSF). The aim of term repo is to help develop inter-bank money market, which in turn can set market based benchmarks for pricing of loans and deposits, and through that improve transmission of monetary policy. Term repo auctions are conducted on e-kuber platform through electronic bidding as is done in the case of auctions under Open Market Operations (OMO[5]) . The total amount of liquidity injected through term repos is limited to 0.75% of Net Demand and Time Liabilities (NDTL) of the banking system. Banks would be required to place their bids with the term repo rate that they are willing to pay to RBI for the tenor of the repo expressed in percentage terms up to two decimal places. While the 14 day term repo of tenor would be conducted every reporting Friday, the 7 day term repo would be conducted on every non-reporting Friday. In case the notified amount for the 14-day term repo is not fully subscribed, a 7-day term repo would be conducted on the following Friday for the remaining un-subscribed amount. In case of full subscription in the 14-day term repo, there will be no 7 day term repo auction on the following Friday.

At present, the objective of meeting short term liquidity needs is being accomplished through the provision of liquidity by the Reserve Bank under its regular facilities - variable rate 14-day/7-day repo auctions equivalent to 0.75 per cent of banking system NDTL, supplemented by daily overnight fixed rate repos (at the repo rate) equivalent to 0.25 per cent of bank-wise NDTL. Frictional and seasonal mismatches that move the system away from normal liquidity provision are addressed through fine-tuning operations, including variable rate repo/reverse repo auctions of varying tenors.

The 2014 Urjit Patel Committee recommended that as the 14-day term repo rate stabilizes, central bank liquidity should be increasingly provided at the 14-day term repo rate and through the introduction of 28-day, 56-day and 84-day variable rate auctioned term repos by further calibrating the availability of liquidity at the overnight repo rate as necessary. The objective should be to develop a spectrum of term repos of varying maturities with the 14-day term repo as the anchor. The 14-day term repo rate is superior to the overnight policy rate since it allows market participants to hold central bank liquidity for a relatively longer period, thereby enabling them to on lend/repo term money in the inter-bank market and develop market segments and yields for term transactions. More importantly, term repos can wean away market participants from the passive dependence on the RBI for cash/treasury management. The committee felt that overnight repos under the LAF have effectively converted the discretionary liquidity facility into a standing facility that could be accessed as the first resort, and precludes the development of markets that price and hedge risk. Improved transmission of monetary policy thus becomes the prime objective for setting the 14-day term repo rate as the operating target instead of the weighted average call money rates.

In its April 2016 Monetary Policy statement, RBI allowed substitution of securities in market repo transactions in order to facilitate development of the term money market.

Types of Repos based on structuring

Based on the structuring of the Repo, they are classified broadly into four types:

Indian markets follow this type of repos.

Though this resembles more to a collateralised lending, it is treated as a category of repo; India has a separate “Security Lending and Borrowing Mechanism” (SLBM) under the regulatory jurisdiction of SEBI. SLBM is a mechanism under which securities are temporarily transferred by one party (the lender) to another (the borrower) via an approved intermediary (Clearing Corporations). While securities lending generally happens in many countries on the Over the Counter (OTC) negotiated platform, in India, securities lending is mandated to be on the stock exchange platform where automatic order matching is one. A SLB trade involves transfer of securities for a fee (lending Fees), for a pre-determined period from the lender to the borrower; the borrower is obliged to return them either on demand or at the end of the agreed term. The SLBM has mainly been used for shorting securities in the cash market (i.e., selling the security without having the same in hand, anticipating that prices would fall in future and then can be brought back for making the settlement), settling open short positions, and for arbitrage[6] between cash and derivatives segments.

The Working Group on Enhancing Liquidity in the Government Securities and Interest Rate Derivatives (Chairman: Shri R. Gandhi) had recommended introduction of tripartite repo in India to develop a term repo market. In this context, it has been decided to undertake a comprehensive review of collateralised money market segments, including introduction of tripartite repo, in consultation with market participants. The review is scheduled to be published by RBI by September 2016 for wider feedback.

Collateralized Borrowing and lending Obligations (CBLO) developed by Clearing Corporation of India Ltd (CCIL) is considered as a repo variant with the combined structure of held -in-custody and tripartite repo in which the contract can be traded, unlike other standard repo in which the security under repo can be traded but the contract cannot be unwound till the end of the contract. CBLO is a money market instrument operated by the CCIL for the benefit of the entities who have either no access to the unsecured inter-bank call money market or have restricted access in terms of ceiling on call borrowing and lending transactions.

By participating in the CBLO market, CCIL members can borrow or lend funds against the collateral of eligible securities. Eligible securities are Central Government securities including Treasury Bills, and such other securities as specified by CCIL from time to time. Borrowers in CBLO have to deposit the required amount of eligible securities with the CCIL based on which CCIL fixes the borrowing limits. CCIL matches the borrowing and lending orders submitted by the members and notifies them. While the securities held as collateral are in custody of the CCIL, the beneficial interest of the lender on the securities is recognized through proper documentation.

CBLO is available for the maturity period ranging from one day to ninety days (up to one year as per RBI guidelines).

Here, the clearing corporation - CCIL - provides an anonymous order matching system for trading funds against the collaterals, which are immobilized at the service provider. In order to enable the market participants to borrow and lend funds, CCIL provides the Dealing System through Indian Financial Network (INFINET), a closed user group to the Members of the Negotiated Dealing System (NDS) who maintain Current account with RBI and through Internet for other entities who do not maintain Current account with RBI.

Membership to the CBLO segment is extended to entities who are RBI- NDS members, viz., Nationalized Banks, Private Banks, Foreign Banks, Co-operative Banks, Financial Institutions, Insurance Companies, Mutual Funds, Primary Dealers, etc. Associate Membership to CBLO segment is extended to entities who are not members of RBI- NDS, viz., Co-operative Banks, Mutual Funds, Insurance companies, NBFCs, Corporates, Provident/ Pension Funds, etc.

Types of Repo Market operating in India

The repo markets operating in India can be broadly classified into two, based on the nature of securities used for repo transactions.

a) Repo on sovereign securities

What is typically known as ‘Repo market in India’ is the repo market based on sovereign securities. It has got actually three different functional segments-

The operations of LAF are conducted by way of repos and reverse repos with RBI being the counter-party to all the transactions. It is conducted at a fixed time on a daily basis and on special occasions if liquidity situation warrants so. Also, an additional LAF repo is conducted on reporting Fridays.

On the other hand, Market repo rate is determined by the credit worthiness of the borrower, liquidity of the collateral and comparable rates of other money market instruments. Being a collateralised loan, its rate is generally lower than the unsecured call money rates. Here the seller and buyer can be banks or any authorised financial institution and the collateral used is government securities. Market repo rates are quoted on a daily basis by CCIL on its platform.

It may be noted that, the combo instrument - market Term Repos of 14-day and 7 day tenor under LAF - are conducted through e-kuber core banking solution of RBI.

In the LAF window, Repo rate, or repurchase rate, is the rate at which RBI lends to banks for short periods. This is done by RBI buying government bonds from banks with an agreement to sell them back at a fixed rate. Reverse repo rate is the rate of interest at which the RBI borrows funds from other banks in the short term. Like the repo, this is done by RBI selling government bonds to banks with the commitment to buy them back at a future date.

In India, overnight repo rate in the LAF window, as fixed by the RBI during its monetary policy announcements, is considered as the policy rate (the key rate based on which all other short term interest rates move). Repo rate changes transmit through the money market to alter the other interest rates in the financial system, which in turn influence aggregate demand - a key determinant of inflation and growth.

If the RBI wants to make it more expensive for banks to borrow money, it increases the repo rate. Similarly, if it wants to make it cheaper for banks to borrow money, it reduces the repo rate.

In other words, an increase in the repo rate will lead to liquidity tightening and vice-versa, other things remaining constant.

The policy framework of the RBI aims at setting the repo rate based on a forward looking assessment of inflation, growth and other macroeconomic risks, and modulation of liquidity conditions to anchor money market rates at or around the repo rate. Vide Finance Act 2016, the task of fixing the policy rate is assigned to the Monetary Policy Committee.

The banks use the reverse repo facility to deposit their short-term excess funds with the RBI and earn interest on it. An increase in the reverse repo rate will decrease the money supply and vice-versa, other things remaining constant. An increase in reverse repo rate means that commercial banks will get more incentives to park their funds with the RBI, thereby decreasing the supply of money in the market.

The securities used in the RBI LAF repo by a Bank (while borrowing money from RBI) can be considered under SLR requirement while the reverse repo deals entered with the RBI by a Bank does not provide SLR benefit as RBI does not use a pure Buy/Sell Back mechanism but credits the securities to a pool account and not to the account of the individual Subsidiary General Ledger (SGL)[10] account of the Banks.

b) Repo on corporate Debt Securities:

As part of the measures to develop the corporate debt market, RBI has permitted select entities (scheduled commercial banks excluding Regional Rural Banks (RRBs) and Local Area Banks (LABs), Primary Dealers (PDs), all-India Financial Institutions, Non-Banking Financial Companies (NBFCs), mutual funds, housing finance companies, insurance companies) to undertake repo in corporate debt securities since January 2010. This is similar to repo in Government securities except that corporate debt securities are used as collateral for borrowing funds. Only listed corporate debt securities that are rated ‘AA’ or above by the rating agencies are eligible to be used for repo. Commercial paper[11] , certificate of deposit[12], non-convertible debentures of original maturity less than one year are not eligible for the purpose. These transactions take place in the over the counter (OTC) market and are required to be reported on FIMMDA[13] platform within 15 minutes of the trade for dissemination of information. They are also to be reported on the clearing house of any of the exchanges for the purpose of clearing and settlement. More details may be seen here.

c) Other Repos:

CBLO segment operated by CCIL and SLBM operated by stock exchanges under the jurisdiction of SEBI are also treated as variants of the repo market in India.

Purpose of Repo and Reverse Repos

The overall effect of the repo transaction would be borrowing of funds backed by the collateral of Government / corporate securities.

Repos are used by traders to obtain cash or to obtain securities. A bank needing cash but having required securities can enter into a repo transaction with another institution by selling the securities under repo to acquire cash. In this case, the lender of the cash uses the securities as collateral. Alternatively, a bank in India can enter into a reverse repo transaction to borrow securities from another bank by lending cash so as to maintain its regulatory requirement of Statutory Liquidity Ratio (SLR). As Indian market follows a buy/sell-back repo mechanism, it allows the holder /borrower of the security to use the same for achieving the SLR level specified by RBI.

Repo transactions are also used to fund "long" positions in securities. That is, they are used to build up leveraged long positions in securities markets. A trader uses cash raised through an initial repo transaction to buy securities which, in turn, are repoed out to raise more cash to buy more securities and so on. With each transaction the leverage ratio is increased. The maximum extent of leverage that can be built up through this process is determined by the margin or “haircut”. Haircut depends on the credit worthiness of the borrower of funds and the price volatility of the collateral. Haircuts for low-risk borrowers like banks using less-volatile collateral like sovereign bonds can be very low. In India, such speculative activities using repo market are not that dominant, at present.

Under LAF-Repo, the Reserve Bank of India injects funds to organisations (Scheduled commercial Banks (SCBs) and Primary Dealers (PDs [14]) which have both current account and Subsidiary General Ledger (SGL) account[15] with the Reserve Bank of India. Thus, repo is essentially a liquidity management tool at the hand of RBI. In fact, the LAF Repo Rate fixed by the RBI in the overnight segment serves as the policy rate in India.

Relationship between LAF- Repo and Reverse Repo rates in India

LAF Repo and reverse repo rates were being fixed separately till the monetary policy statement of 3.5.2011. In this 2011 monetary policy statement, it was decided that the reverse repo rate would not be announced separately but will be linked to repo rate. The reverse repo rate was proposed to be kept at 100 basis points below repo rate (100 basis points = 1%). Thus, reverse repo ceased to exist as an independent rate. In the April 2016 monetary policy statement, it was decided to keep reverse repo rate at 50 basis points (0.5%) below the repo rate.

The spread between Repo and Reverse repo forms the lower end of the interest rate corridor or policy corridor (which is the spread between Marginal Standing Facility (MSF) and Reverse Repo Rate). In April 2016, RBI narrowed the policy rate corridor from +/-100 basis points (bps) to +/- 50 bps. Thus, MSF will be fixed 50 basis points above repo rate and Reverse repo would be fixed 50 basis points below Repo rate. This was done with a view to ensure finer alignment of the weighted average call rate or the overnight money market rates with the repo rate (which essentially means more effective transmission of monetary policy).

History of Repo Rates in India: Changes in nomenclature

The introduction of Liquidity adjustment facility in India was on the basis of the recommendations of Narsimham committee on banking sector reforms. In April 1999, an interim LAF was introduced to provide a ceiling and the fixed rate repos were continued to provide a floor for money market rates (It may be noted that floor is technically represented by the reverse repo rates as per the present terminology). As per the policy measures announced in 2000, the Liquidity Adjustment Facility was introduced with the first stage starting from June 2000 onwards. Subsequent revisions were made in 2001 and 2004. When the scheme was introduced, repo auctions were described for operations which absorbed liquidity from the system and reverse repo actions for operations which injected liquidity into the system. However in international nomenclature, repo and reverse repo implied the reverse. Hence, in October 2004 when revised scheme of LAF was announced, the decision to follow the international usage of terms was adopted.

Accounting treatment of Repos

The RBI guidelines on the accounting treatment of repos in India were issued in 2003 and modified further in 2010. In the books of banks, repos are entered segment wise by breaking it into security price and interest income, as security value /price is a part of the Balance sheet (Asset side when it enters the book) while accrued interest is absorbed in the Profit and Loss Account.

It is proposed to align the accounting norms to be followed by market participants for repo/reverse repo transactions under the liquidity adjustment facility (LAF) and the marginal standing facility (MSF) with the accounting guidelines prescribed for market repo transactions. Guidelines in this regard is proposed to be issued by end-May 2016.

International Practice

Federal Reserve started using a type of repo in 1920s, while Bank of Canada used repos since 1953. Bank of England started using repos with government securities in 1997, while Japan and Switzerland started using repos in 1997 and 1998, respectively. Canada, Italy and Sweden use the buy/sell-backs, while Japan uses securities borrowing with cash collateral. The Netherlands uses a special loans system in which loans are collateralised via pledge on a pool of collateral (general). Most of the countries use the forms of repo keeping in mind the legal and institutional framework that prevails in each country[16].

1. A market for short term financial instruments (upto one year maturity)

2. Borrowing by pledging a collateral / asset/security to the lender of money

3. The percentage by which value of the security is reduced by the buyer of that security for the purpose of calculating the collateral value or margin requirement.

4. Uptill November 1, 2004, the auctions of 7-day and 14-day repo (reverse repo by international parlance) used to be conducted. With effect from November 1, 2004, the LAF Scheme is being operated through overnight fixed rate repo and reverse repo.

5. OMOs are the market operations conducted by the Reserve Bank of India by way of sale/ purchase of Government securities to/ from the market with an objective to adjust the rupee liquidity conditions in the market on a durable basis. When the RBI feels there is excess liquidity in the market, it resorts to sale of securities thereby sucking out the rupee liquidity. Similarly, when the liquidity conditions are tight, the RBI will buy securities from the market, thereby releasing liquidity into the market.

6. The process of selling in a market where the price is higher and buying from a market where the price is lower

7. The risk of opposite party not returning the securities lent, or money borrowed

8. Renewal of contract to another period

9. Uptill November 1, 2004, the auctions of 7-day and 14-day repo (reverse repo by international parlance) used to be conducted. With effect from November 1, 2004, the LAF Scheme is being operated through overnight fixed rate repo and reverse repo.

10. See footnote 15 on SGL

11. Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note. Corporates, primary dealers (PDs) and the all-India financial institutions (FIs) that have been permitted to raise short-term resources under the umbrella limit fixed by the Reserve Bank of India are eligible to issue CP. CP can be issued for maturities between a minimum of 7 days and a maximum up to one year from the date of issue.

12. Certificate of Deposit (CD) is a negotiable money market instrument and issued in dematerialised form or as a Usance Promissory Note, for funds deposited at a bank or other eligible financial institution for a specified time period. Banks can issue CDs for maturities from 7 days to one a year whereas eligible FIs can issue for maturities 1 year to 3 years.

13. The Fixed Income Money Market and Derivatives Association of India (FIMMDA), an association of Scheduled Commercial Banks, Public Financial Institutions, Primary Dealers and Insurance Companies was incorporated as a Company under section 25 of the Companies Act, 1956 on June 3rd, 1998. FIMMDA is a voluntary market body for the bond, money and derivatives markets. FIMMDA has members representing all major institutional segments of the market. The membership includes Nationalized Banks such as State Bank of India, its associate banks and other nationalized banks; Private sector banks such as ICICI Bank, HDFC Bank, IDBI Bank; Foreign Banks such as Bank of America, ABN Amro, Citibank, Financial institutions such as IDFC, EXIM Bank, NABARD, Insurance Companies like Life Insurance Corporation of India (LIC), ICICI Prudential Life Insurance Company, Birla Sun Life Insurance Company and all Primary Dealers. The FIMMDA represents market participants and aids the development of the bond, money and derivatives markets. It acts as an interface with the regulators on various issues that impact the functioning of these markets. It also undertakes developmental activities, such as, introduction of benchmark rates and new derivatives instruments, etc. FIMMDA releases rates of various Government securities that are used by market participants for valuation purposes. FIMMDA also plays a constructive role in the evolution of best market practices by its members so that the market as a whole operates transparently as well as efficiently.

14. The system of Primary Dealers was introduced in 1995. The PDs are expected to absorb government securities in primary markets when it is issued, to provide two-way quotes in the secondary market where it is traded and help develop the retail market. In short, they are wholesale traders of government securities.

15. SGL or CSGL are a demat /electronic form of holding government securities with the RBI. SGL stands for 'Subsidiary General Ledger' account. It is a facility provided by RBI to large banks and financial institutions to hold their investments in Government securities and Treasury bills in the electronic book-entry form. Such institutions can settle their trades for securities held in SGL through a Delivery-versus-Payments (DVP) mechanism [or spot deals], which ensures movement of funds and securities simultaneously. The SGL, in short keeps the names of all investor in a particular security at any point of time. The securities are held in electronic form in SGL accounts. Investors may also open a Constituent SGL account with any entity authorised by RBI for this purpose and thus avail of the DVP settlement. Such client accounts are referred to as Constituent SGL accounts. Securities kept on behalf of customers by banks or Primary Dealers (PDs) in Constituent SGL account are kept in a segregated CSGL A/c with the RBI. Thus, if the bank or the PD buys security for his client, it gets credited to the CSGL account of bank or PD with the RBI. Successful bidders are allotted securities bid by them. RBI can debit their current accounts for amount payable and credit their SGL account with the securities allotted to them. The amount debited to the current account is placed to the credit of Government Account. The system of holding and settling securities through the constituent SGL account is not only safe but is faster also as the delivery of funds/securities is ensured on the same day. Apart from the prompt settlement of trades, constituent SGL holders also benefit from prompt and virtually hassle free interest payments, redemption and other types of corporate actions.

16. Source: Dr. Golaka C Nath (2013): December.pdf Repo Market - A Tool to Manage Liquidity in Financial Institutions, CCIL Monthly Newsletter, Clearing Corporation of India Ltd (CCIL), December 2013

Also See


Contributed by

Personal tools
Share Tools