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Informist, Monday, Feb. 17, 2025

 

MUMBAI – The Reserve Bank of India has permitted transactions between primary members and their gilt account holders or those between two gilt account holders under the same primary member to be matched on both the anonymous order matching segment and the request for quote segment of the RBI's Negotiated Dealing System-Order Matching platform, the central bank said in a notification Monday.

 

Such matches would be cleared and settled via the Clearing Corp. of India, the notification said. The RBI also included the option for bilaterally negotiated trades which were reported to NDS-OM between either a primary member trading with its own gilt account holder or trades between two gilt account holders under the same primary member to clear and settle the deal through CCIL.

 

Detailed operational guidelines about the same would be issued by the Clearing Corp. of India, the notification said. Any failure in the settlement of these transactions would be treated as an instance of 'SGL (subsidiary general ledger) bouncing' and be subjected to the applicable penal provisions. SGL bouncing happens when a transaction involving a government security fails due to lack of funds.   

 

Gilt transactions in the over-the-counter market are currently conducted either on the Negotiated Dealing System - Order Matching platform or are reported on it after negotiations outside the system, the notification said. All transactions matched on the order matching  platform are cleared and settled through the Clearing Corp. of India, which acts as a central counter party for transactions in gilts.

 

Before the notification, transactions between a primary member and its own gilt account holder, and between two gilt account holders of the same primary member were not permitted to be matched on NDS-OM and were also not cleared and settled through Clearing Corp. of India.  End

 

Reported by Cassandra Carvalho

Edited by Deepshikha Bhardwaj

 

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