DBOD.No. Dir. BC. 78/13.07.05/98-99      

August 8, 1998

Shravana 17, 1920 (Saka)

All Commercial Banks

Dear Sir,

Investments in and underwriting of shares and debentures of corporate bodies

Please refer to our circular DBOD. Dir. BC.60/13.07.05/97 dated May 28, 1997, in terms of which banks are allowed to invest in equity shares including PSU shares, convertible debentures of corporates and in units of Mutual Fund Schemes, the corpus of which is not exclusively invested in corporate debt instruments within the limit of 5% of incremental deposits of the previous year. It is clarified that investments in equity in dedicated venture capital funds meant for Information Technology is also eligible for inclusion within the five per cent limit prescribed for investments in equity instruments.

Yours faithfully

(Radhe Shyam)

Additional Chief General Manager