SEBI to hold special auction of debt securities on 4th July
MDT/PTI 27 June 2012

After RBI increased the limit of FII investments in government debt and initiated other steps, SEBI will hold a special auction on 4th July for foreign institutional investors

 

Mumbai: Market regulator Securities and Exchange Board of India (SEBI) said a special auction of debt securities for foreign institutional investors would be held on 4th July, reports PTI.

The announcement comes a day after the Reserve Bank of India (RBI) increased the limit of FII investments in government debt and initiated other steps, as part of efforts to boost fund inflows and arrest the sliding rupee.

"It has been decided that additional limit for FIIs investments in government debt long term category and corporate debt long term infra category (with one year lock-in and 15 months residual maturity), shall be allocated through special auction.

"The auction for this limit shall be done on the BSE from 15:30 hrs to 17:30 hrs, on Wednesday, on 4 July 2012," SEBI said in a circular.

On Monday, RBI said the limit for FII investments in government debt has been increased by $5 billion taking the overall limit to $20 billion.

Further, the conditions for the limit of $22 billion for FII investment in corporate debt long term infra category, including the sub-limit of $5 billion with one-year lock-in/residual maturity requirement and $10 billion for non resident investment in IDFs have been changed.

The lock-in period for investments under this limit has been reduced to one year.

According to the circular, the allocation of additional limits under government debt as well as corporate debt categories would be auctioned through electronic bidding process.

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