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Informist, Wednesday, Sept. 3, 2025

By Shravani Chandiwade

MUMBAI – Rates in the certificates of deposit market remained unchanged Wednesday as the liquidity surplus widened and participation from issuers was subdued. Market participants engaged only in need-based issuances to roll over their upcoming maturities and meet quarter-end needs, dealers said. "Participation from banks was low today in the primary market as they are awaiting the effects of CRR (cash reserve ratio) cut from the central bank this week," a dealer at a state-owned bank said.

The Reserve Bank of India cut the CRR by 100 basis points to 3% of banks' net demand, and time liabilities, Governor Sanjay Malhotra had said in the June Monetary Policy Committee's outcome. This is to be rolled out in four tranches starting Saturday.

Issuances of certificates of deposit on Wednesday totalled INR 48.00 billion, down from INR 52.50 billion Tuesday. HDFC Bank and Union Bank raised INR 10 billion each at 5.75% and 6.10%, respectively. HDFC Bank raised the sum through a one-month paper and Union Bank through a five-month paper. Bank of Baroda also tapped the market to raise a cumulative sum of INR 22.50 billion through a three-month paper and a five-month paper. The public sector bank has total CDs worth INR 22.40 billion maturing this month. 

Indicative rates in the CD market remained steady Wednesday. Rates on three-month CDs were at 5.75-5.80% and those on six-month CDs at 6.05-6.16%. Rates for one-year papers were at 6.30-6.35%.

In terms of commercial papers, the volume of issuances fell sharply on Wednesday, with companies and non-banking financial companies raising INR 39.75 billion, against INR 141.50 billion Tuesday. Indian Oil Corp Ltd. was the top issuer, raising INR 20 billion through a three-month paper at 5.88%. SBI Capital Securities was the other major issuer, raising INR 7.00 billion through a three-month paper at 6.62%.

Indicative rates for three-month CPs issued by manufacturing companies were 5.90-5.95%, up from 5.85-5.90% on Tuesday. Those issued by non-banking finance companies remained steady at 6.35–6.39%, dealers said. 

--Primary market

* Axis Securities, Birla Group Holding, Godrej Properties, SBI Capital Securities,Indian Oil Corporation and Bharat Heavy Electricals raised funds through CPs.

* Bank of Baroda, HDFC Bank, Union Bank raised funds through CDs.

--Secondary market

* Bank of Baroda's CD maturing Thursday was traded 10 times at a weighted average yield of 5.3102%

* Bharat Airtel's CP maturing Thursday was traded 10 times at a weighted average yield of 5.3912%

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 Avishek Dutta

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