Business Standard

Monday, December 23, 2024 | 08:39 PM ISTEN Hindi

Notification Icon
userprofile IconSearch

RBI says banks can't bid for term repos at or below rate

Repo rate currently at 7.50%

BS Reporter Mumbai
Banks cannot bid for term repos at or below the prevailing repo rate under liquidity adjustment facility (LAF), the Reserve Bank of India (RBI) said on Tuesday. RBI will conduct seven-day and 14-day repos on alternate Fridays starting this Friday, the central bank said in a statement.

The repo rate currently stands at 7.50 per cent.

After market hours on Monday RBI had announced it would conduct term repos for seven-day and 14-day for a total amount of 0.25 percent of Net Demand and Time Liabilities (NDTL) of the banking system.

The 14-day repos will be conducted on every reporting Friday, while the seven-day repos will be on the non-reporting Fridays, said the banking regulator.

According to RBI, if banks borrow the entire 0.25 percent of deposits through the 14-day term repo, there will be no seven-day repos on the following Friday.

Once the bidding time is over, RBI will arrange all bids received in a descending order of the term repo rates quoted and the cut-off rate would be arrived at the rate corresponding to the notified amount of the auction. On the day prior to the auction, RBI will announce the amount to be auctioned under term repo along with its tenor, the bank pointed out.

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Oct 09 2013 | 12:48 AM IST

Explore News