Money & Banking

Govt to convert 5 securities aggregating Rs 27K cr into 3 securities

Our Bureau Mumbai | Updated on June 11, 2020 Published on June 11, 2020

These will be converted through an auction by the Reserve Bank of India (RBI) on June 15.

The Government will be converting/ switching five securities, which will mature in 2021 and 2022, aggregating Rs 27,000 crore into three securities maturing between 2026 and 2060, through an auction that will be held by the Reserve Bank of India on June 15.

The central bank started conducting the auction for conversion of Government of India securities (G-Secs) on the third Monday of every month since April 22, 2019.

Bidding in the auction implies that the market participants agree to sell the source security/ies to the Government of India (GoI) and simultaneously agree to buy the destination security from the GoI at their respective quoted prices.

G-Secs conversion

The RBI said the 7.94 per cent (coupon rate) G-Sec 2021 aggregating Rs 6,000 crore will be converted into 7.16 per cent G-Sec 2050.

The 10.25 per cent G-Sec 2021 aggregating Rs 9,000 crore will be converted into 7.19 per cent G-Sec 2060.

Three G-Secs -- 8.15 per cent G-Sec 2022, 8.08 per cent G-Sec 2022 and 8.13 G-Sec 2022 -- with a notified amount of Rs 4,000 crore each will be converted into a single security -- 7.2 per cent G-Sec 2026 aggregating Rs 12,000 crore.

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Published on June 11, 2020
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