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Informist, Monday, Jul. 28, 2025

By Siddhi Chauhan

MUMBAI – No fund was raised through certificates of deposits Monday as most banks had fulfilled their funding needs earlier in the month, dealers said. Low supply from banks kept the short-term borrowing rates unchanged, they added.

So far in July, banks have already exceeded their rollover needs by issuing CD worth INR 344.60 billion against maturing papers worth INR 230.95 billion, data compiled by Informist showed. Ample liqudity in the banking system also ebbed demand from banks, dealers said.

On Sunday, net liquidity absorbed by the RBI--a proxy for the systemic liquidity surplus--was INR 2.48 trillion, largely unchanged from INR 2.46 trillion on Saturday but down from INR 2.88 trillion Friday, Reserve Bank of India data showed.

"Given the current liquidity level, there doesn't seem to be any need for funds right now," a dealer at a state-owned bank said. "Most of the demand have been met. This is why even in the secondary market the volume is quite low."

Meanwhile, on the commercial paper side, fundraising picked up due to rollover needs from issuers, dealers said. On Monday, funds worth INR 40 billion were raised through CPs against no issuance on Friday. 

Reliance Industries, which was the largest CP issuer, raised INR 35 billion through a September maturity paper at 5.73%, followed by Sundaram Finance which raised INR 5 billion through one-year paper at 6.55%. Sundaram Finance's CP worth INR 5.00 billion are set to mature on Wednesday and CPs worth INR 5.05 billion are set to mature Thursday, data compiled by Informist showed. 

On Monday, rates on the three-month paper issued by banks were unchanged from Friday's levels at 5.75-5.95%. The indicative rates for three-month CPs issued by manufacturing companies remained unchanged at 5.80-5.85% and for non-banking financial companies, the indicative rates were at 6.15-6.20%. 

--Primary market

* Reliance Industries and Sundaram Finance raised funds through CPs.

* No banks raised funds through CDs.

--Secondary market

* Punjab National Bank's CD maturing Tuesday was traded three times at a weighted average yield of 5.3298%.

* Reliance Jio Infocomm Ltd.'s CP maturing Tuesday was traded 10 times at a weighted average yield of 5.3346%.

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 Akul Nishant Akhoury

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