Listing of issues key to market revival

Outlook/ Corporate bonds

 Bankers had a meeting with the central bank and the stock exchanges to simplify the norms for listing of corporate bonds and debentures so as to minimise the cost and time taken for issuing the paper.

 The central bank, on the other hand, has asked banks to force the issuers to list their issues with immediate effect.

 However, one-to-one deals among primary dealers and mutual funds continue in the market to help the mutual funds remain liquid for meeting the redemption pressure.

 Dealers said that, till the time the issues are listed, the activity in the corporate bonds market will remain lacklustre.

 Banks wary of investing in commercial papers

 Commercial papers saw some activity with HDFC issuing a six-month paper at 5.01 per cent.

 Although banks are wary of investing in CPs till the time a clarification comes from the Reserve Bank on the status of investments in commercial papers, mutual funds and certificates of deposit, some banks are opening exposure to CPs for one or two days in the primary market.

 Later they are offloading them in the secondary market to mutual funds, who do not have any restrictions on investments.

 Dealers said corporates could have easily placed the CPs with mutual funds, but the fact that they have to pay stamp fees is making the idea a bit expensive.