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Informist, Monday, Mar. 3, 2025

By Kabir Sharma

MUMBAI – Issuances of certificates of deposits rebounded on Monday as banks raised funds to roll over maturing papers, dealers said. A total of INR 94.00 billion was raised via CDs on Monday after a barren Friday. Meanwhile, the commercial paper segment saw issuances of just INR 9.00 billion as major issuers were absent, dealers said.

According to dealers, CD issuances over the next few days will be driven by rollovers as liquidity conditions in the banking system are improving and investors are unlikely to see interest rates at desired levels. "There will be issuances, but rates will fall as there is ample liquidity now. So people might not invest as heavily at least until Thursday when excise tax outflows will start," a dealer at a state-owned bank said.

Monday, Export-Import Bank of India and Canara Bank raised INR 25.00 billion and INR 20.00 billion, respectively, via one-year CDs at 7.58%. Meanwhile, Small Industries Development Bank of India raised INR 11.00 billion via a one-year paper at 7.64%. Bank of Baroda raised INR 31.00 billion via a three-month paper at 7.49%. Rates on three month papers were in the range of 7.45-7.65%.

CPs saw less action on Monday, with only Aditya Birla Housing Finance, Kotak Securities, and Aditya Birla Money raising funds. Aditya Birla Housing Finance raised INR 4.00 billion via a three-month paper at 7.60%, while Kotak Securities raised the same amount at 7.88%. Aditya Birla Money raised INR 1.00 billion for three months at 8.15%. Rates on three-month CPs from non-bank financial companies were in the range of 7.90-8.10%, while those of manufacturing companies were in the range of 7.60-7.80%.

--Primary market

* Canara Bank, Union Bank of India, Bank of Baroda, Export-Import Bank of India, and Small Industries Development Bank of India raised funds via CDs on Monday.

* Aditya Birla Housing Finance, Aditya Birla Money, and Kotak Securities raised funds through CPs.

--Secondary market

* Union Bank of India's CD maturing on Tuesday was traded at 6.3156%.

* ICICI Securities' CP maturing on Tuesday was traded four times at a weighted average yield of 6.3473%.

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1700 IST, as detailed by the Clearing Corp. of India's F-TRAC platform:

End

Edited by Deepshikha Bhardwaj

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