New Delhi: The Reserve Bank of India (RBI) will conduct Open Market Operations (OMO) in State Development Loans (SDLs) on Thursday. The central bank has allocated Rs 10,000 crore to purchase SDLs.
In a view to adjusting liquidity conditions of the country’s economy, OMOs refer to sale or purchase of government securities to commercial banks of the country. The SDLs are defined as securities issued by the states to manage their own finances.
The RBI said through a release that SDLs will be bought through a multi-security auction. The size of purchase auctions might be increased in subsequent auctions.
Those eligible for the auction would have to submit bids in electronic format on the RBI Core Banking Solution (E-Kuber) system between 10 am and 11 am on Thursday.
“Bids or offers in physical form will only be accepted if there is system failure and such bid or offer should be submitted to the financial markets operations in the prescribed form obtainable from RBI website before 11 am on Friday,” the release from the central bank read.
The auction result will be declared on Thursday itself and successful participants are required to ensure availability of the requisite amount of securities in their Subsidiary General Ledger (SGL) account by 12 noon on Friday, according to Hindustan Times.
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