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SME Times News Bureau | 09 Oct, 2020
As part of efforts to revive economic activity in specific sectors and
maintain liquidity flows in the financial markets, the Reserve Bank of
India on Friday decided to conduct a Rs 1 lakh crore on-tap Targeted
Long Term Repo Operations (TLTRO).
The Reserve Bank of India
(RBI) in its late March policy action introduced the TLTROs as a tool to
enhance liquidity in the system, particularly the corporate bond
market, in the wake of the Covid-19 crisis.
RBI governor
Shaktikanta Das said that fresh TLTROs will focus on providing l
iquidity support for revival of activity in specific sectors that have
both b ackward and forward linkages, and multiplier effects on growth.
Accordingly,
it has been decided liquidity availed by banks under the scheme has to
be deployed in corporate bonds, commercial papers, and non-convertible
debentures issued by the entities in specific sectors over and above the
outstanding level of their investments in such instruments as on
September 30, 2020.
The Rs 1 lakh crore TLTROs will be available
for tenors of up to three years issued at a floating rate linked to the
policy repo rate. The scheme will be available up to March 31, 2021 with
flexibility with regard to enhancement of the amount and period after a
review of the response to the scheme.
The liquidity availed
under the scheme can also be used to extend bank loans and advances to
identified sectors. Investments made by banks under this facility will
be classified as held to maturity (HTM) even in excess of 25 per cent of
total investment permitted to be included in the HTM portfolio.
All exposures under this facility will also be exempted from reckoning under the large exposure framework (LEF).
Moreover,
banks that had availed of funds earlier under targeted long-term repo
operations (TLTRO and TLTRO 2.0) have the option of reversing these
transactions before maturity.
In view of the borrowing
requirements of the Centre and states in the second half of 2020-21 and
the likely pick-up in demand for credit as the recovery gathers
strength, on-tap TLTROs are intended to enable banks to conduct their
operations smoothly and seamlessly without being hindered by illiquidity
frictions, the RBI governor said.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
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64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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