Informist, Friday, Mar 31, 2023
By Vishal Sangani
MUMBAI – Indian Bank was the lone issuer of certificates of deposit today, raising 20 bln rupees at 7.18% through papers maturing in three months. The state-owned bank tapped the market for its funding needs, dealers said.
On Wednesday, IDBI Bank was the only issuer and had raised 6.50 bln rupees through CDs.
Most banks remained on the sidelines as there was no immediate need for funds and also as surplus liquidity had widened in the banking system. Banks also remained on the sidelines after completing their year-end borrowings.
Liquidity in the banking system is currently estimated to be in a surplus of 1.07 trln rupees, up from 135.83 bln rupees on Wednesday. The liquidity surplus widened further due to inflows on account of the government’s month-end spending in the form of salaries and pension payouts, dealers said.
Money markets were shut on Thursday on account of Ram Navami.
On the other hand, ICICI Securities was the only issuer today, raising 1.50 bln rupees through papers maturing in June at 7.20%.
On Wednesday, CPs worth 35 bln rupees were issued.
The amount of money raised through CPs also fell today in the absence of big-ticket issuances.
Issuers also remained on the sidelines after completing their year-end borrowings.
Demand from mutual funds has slowed, as most have completed refinancing of investments that have matured, dealers said.
Rates on short-term debt papers were in a narrow range due to lower issuances, dealers said.
Rates on three-month CPs issued by non-banking finance companies were quoted at 7.60-7.85%, while rates on papers of manufacturing companies were quoted at 7.40-7.60%.
Rates on three-month CDs were quoted at 7.30-7.50%.
–Secondary market
* HDFC Bank’s CD maturing on Jul 17 was dealt six times at a weighted average yield of 7.1447%
* National Bank for Agriculture and Rural Development’s CP maturing on Jun 7 was dealt four times at a weighted average yield of 7.0686%
At 1631 IST, following were the volumes, in bln rupees, in the secondary market for short-term debt, as detailed by the Clearing Corp of India’s F-TRAC platform:
NOTE: Details of the deals have been received from market sources.
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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