The government securities market is booming and the Securities Trading Corporation of India sees a growing role for itself in it.
To fulfil that role it opened an office here today, the first in the south and the third in the country, after Mumbai and Delhi.
While the government can be relied upon to issue an ever growing volume of gilts, primary dealers have to find large takers for them.
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STCI saw a lot of commercial activity in the city where cash rich IT companies represented potential customers for government securities, explained Dipankar Basu, chairman of STCI and former chairman of State Bank of India.
Such companies were in need of cash management products as, with RBI changing the rules of the game, they now could not enter the call money market through the primary dealers. STCI saw a role for itself in this by being able to offer two-way quotes in governments securities.
STCI has a 10 per cent share of the secondary market for government securities and this market itself has grown ten times since the mid-nineties when primary dealers came into being.
This year, by mid-February, aggregate trading turnover levels have already crossed last year