Press Release*
May 2012
Certificate of Registration of Alternative
Investments and Credits Limited –
Cancelled
May 2, 2012
The Reserve Bank of India has on April 23, 2012
cancelled the certificate of registration (CoR) No.16.00169
dated January 9, 2002, issued to Alternative Investments
and Credits Limited, having its registered office at
34/2444, Sunny Estates, Mamangalam, Koshi-682025
on supervisory grounds. Following cancellation of the
registration certificate the company cannot transact the
business of a non-banking financial institution.
By the powers conferred under Section 45-IA (6)
of the Reserve Bank of India Act, 1934, the Reserve Bank
can cancel the registration certificate of a non-banking
financial company. The business of a non-banking
financial institution is defined in clause (a) of Section
45-I of the Reserve Bank of India Act, 1934.
RBI Announces Rate of Interest on
FRBs 2016
May 4, 2012
The rate of interest on the Floating Rate Bonds,
2016 (FRB, 2016) applicable for the year (May 07, 2012
to May 06, 2013) shall be 8.29 per cent per annum.
It may be recalled that the rate of interest on the
FRB, 2016 was set at a mark-up (as decided in the
auction held on May 6, 2004) over and above the
variable base rate. The variable base rate for payment
of interest shall be the average rate (rounded off up to
two decimal places) of the implicit yields at cut-off
prices emerging in the three auctions of Government
of India 364 day Treasury Bills immediately preceding
the relative annual coupon reset date. The variable base
rate based on the average rate of the implicit yields at
cut-off prices of the said last three auctions of Government of India 364 day Treasury Bills worked out
to 8.25 per cent. The mark-up decided in the auction
held on May 6, 2004 was (+) 0.04 (plus 0.04). The
coupon rate has been fixed accordingly.
RBI takes Measures to ease Foreign
Currency Flows
May 4, 2012
On a review of developments in the global
financial markets and current macro-economic
conditions, the Reserve Bank has taken the following
measures to ease foreign currency flows as also to
enhance the availability of export credit in foreign
currency:
-
Interest rate ceiling on Foreign Currency Non-
Resident [FCNR (B)] deposits of banks has been
raised from 125 basis points (bps) above the
corresponding LIBOR/Swap rates to 200 bps
for maturity period of 1 year to less than 3
years, and to 300 bps for maturity period of 3
to 5 years.
-
The ceiling rate on export credit in foreign
currency which was constraining the
availability of credit to exporters in foreign
currency has been deregulated by allowing
banks to freely determine their interest rates
on such credit
The above measures are aimed at augmenting
foreign currency inflows to banks which in turn would
facilitate their foreign currency loans to exporters.
These measures will come into effect from May 5, 2012.
The detailed guidelines are being issued separately.
RBI Reconstitutes TAC on Financial
Markets
May 7, 2012
The Reserve Bank of India has reconstituted the
Technical Advisory Committee (TAC) on Money, Foreign Exchange and Government Securities Markets. The
composition of the reconstituted TAC is :
Chairman
1 Dr. Subir Gokarn
Deputy Governor
Reserve Bank of India
Members
2 Shri Anil Bisen
Economic Adviser
Department of Economic Affairs
Ministry of Finance, Government of India
3 Shri Prashant Saran
Whole Time Member
Securities & Exchange Board of India (SEBI)
4 Shri R. K. Nair
Member (F & I)
Insurance Regulatory and Development
Authority (IRDA)
5 Shri Ravi Narain
Managing Director and Chief Executive Officer
National Stock Exchange of India Ltd. (NSE)
6 Ms. Chanda Kochhar
Managing Director and Chief Executive Officer
ICICI Bank
7 Shri R. K. Bakshi
Executive Director, Bank of Baroda
8 Shri Gagan Rai
Managing Director and Chief Executive Officer
National Securities Depository Ltd (NSDL)
9 Mr. N.S. Venkatesh
Chairman
Fixed Income Money Market and Derivatives
Association of India (FIMMDA)
10 Shri D. G. Patwardhan
Chief Executive
Foreign Exchange Dealers Association of India
(FEDAI)
11 Shri Milind Barve
Chairman
Association of Mutual Funds of India (AMFI)
12 Shri Pradeep Madhav
Chairman
Primary Dealers Association of India (PDAI)
13 Shri S. B. Mainak
Executive Director (Investment-Operations)
Life Insurance Corporation of India
14 Ms. Roopa Kudva,
Managing Director and Chief Executive Officer
Credit Rating Information Services of India Ltd.
(CRISIL)
15 Amitabh Chaudhry
Managing Director and Chief Executive Officer
HDFC Standard Life Insurance
16 Prof Sankar De
Executive Director
Centre for Analytical Finance
India School of Business
Hyderabad.
17 Prof H.K. Pradhan
Professor Finance
XLRI School of Business & Human Resources
Jamshedpur
18 Prof V Ravi Anshuman,
Professor Finance and Control
Indian Institute of Management Bangalore
Deputy Governor(s), Executive Directors in-charge
of Financial Markets Department (FMD), Internal Debt
Management Department (IDMD), Department of
External Investments and Operations (DEIO) and
Monetary Policy Department (MPD), Heads of FMD,
IDMD, DEIO, MPD, Department of Economic Policy and
Research (DEPR), Foreign Exchange Department (FED),
and Regional Director, Maharashtra and Goa of Reserve
Bank of India will be permanent invitees.
The terms of reference of the Committee are:
i. to review and recommend measures for
deepening and widening the money, foreign
exchange and government securities markets
including those relating to participants,
products, institutional and infrastructural
arrangements, etc.;
ii. to suggest measures for development of
market and promoting liquidity in money
market instruments, foreign exchange market
and government securities;
iii. to examine and advise on the evolving and
desirable linkages among the money, foreign
exchange and government securities and
capital markets;
iv. to review the infrastructure, legal and
institutional arrangements for trading,
transfer and settlement in the money, foreign
exchange and government securities markets
in the context of the emerging payments
system including CCIL;
v. to prepare and consider papers on topics
relating to product/market development and
advise on the policies and practices for the
same.
vi. to review the qualitative and quantitative
aspects of risk management, accounting,
disclosure, settlement, legal framework, etc.
in the money, foreign exchange and government
securities markets and render advise, and
vii. to examine any other relevant issue having a
bearing on these markets referred to it, by RBI.
The Committee may appoint Technical Groups
consisting of its own members and/or outside experts
to study and submit recommendations on specific
issues, if necessary. The Committee will meet as often
as it is required, but at least once in a quarter and will
function for two years from the date of its first meeting.
It may be recalled that the Reserve Bank of India
(RBI) had first constituted the Technical Advisory
Committee on Money and Government Securities
Markets on July 12, 1999 for a tenure of two years. So
far, the TAC has been reconstituted on four occasions,
viz., in September 2001, February 2004, June 2006 and
January 2009. Keeping in view the inter-linkages
between Money, Foreign Exchange and Government
Securities Markets and implications for monetary policy
operations, the ambit of the TAC was widened, at the
time of its reconstitution in February 2004, to include
the foreign exchange markets. The TAC is now being
reconstituted so that the Reserve Bank can continue
obtaining the benefit of opinion from financial market
experts from areas such as, banking, academics,
Government, stock exchanges, credit rating agencies
and market representatives. The confluence of ideas
and the advice brought about by this wide representation
has enabled the Reserve Bank to make further reforms
in financial markets, including products, practices,
institutional arrangements and regulation in these
markets.
The TAC held its first meeting on May 2, 2012 at
Reserve Bank of India, Central Office Mumbai to discuss
recommendations of the Working Group (Chairman:
Shri R. Gandhi) that was set up to examine ways to
enhance liquidity in the G-Sec and Interest Rate
Derivatives Markets.
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