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Informist, Tuesday, Jun. 2, 2026

By Meera Nair

MUMBAI – Yields on three-month certificates of deposit and commercial papers rose marginally Tuesday as liquidity surplus in the banking system narrowed, dealers said. Yields on three-month certificates of deposit rose by 5 basis points, while six-month CD yields increased by 15 bps, they said.

Yields on AAA-rated three-month CDs were at 7.20-7.25% Tuesday, up 5 bps from 7.15-7.20% Monday. Six-month CD yields rose to 7.65-7.70% from 7.50-7.55%, while one-year yields remained steady at 7.80-7.90%. Papers maturing in December, January and February were the most actively traded CDs in the secondary market.

As of 1836 IST, CD issuances totalled INR 30.00 billion, sharply lower than INR 128.90 billion on Monday, according to data from the Clearing Corp of India. Issuers included Axis Bank, Bank of Baroda, Punjab and Sind Bank, Punjab National Bank, and DCB Bank. Axis Bank raised INR 10.25 billion through CDs maturing on Sept. 2 at a weighted average yield of 7.21%, while Bank of Baroda raised INR 7.5 billion through a three-month CD at a weighted average yield of 7.25%. Punjab and Sind Bank mopped up INR 7.0 billion through three-month CDs at a weighted-average yield of 7.63%. 

On the CP side, yields on AAA-rated CPs issued by non-banking finance companies rose 7 bps to 7.92-7.95%, while those on one-year papers fell by 5 bps to 8.05-8.10%. Dealers did not quote six-month CPs.

CP issuances fell to INR 40.39 billion Tuesday from INR 83.47 billion, according to CCIL data. Larsen & Toubro raised INR 7.50 billion through a 27-day CP at a weighted average yield of 6.30%, while HDFC Securities raised INR 35 billion through two different maturity CPs. Kotak Securities raised INR 2.75 billion through two CPs. Other issuers included Axis Securities, Akara Capital Advisors, National Bank for Agriculture and Rural Development, L&T Finance, Motilal Oswal Financial Services, IGH Holdings, Aditya Birla Money, ICICI Securities, Godrej Industries, IIFL Finance, Trust Investment Advisors, YES Securities India, and Phillip Finance and Investment Services India. 

In the secondary market, CDs worth INR 167.85 billion were traded as of 1839 IST Tuesday, sharply up from INR 106.60 billion Monday, according to CCIL data. CP volumes rose to INR 66.60 billion from INR 55.10 billion. "Secondary market activity was spread across a wider range of maturities, from three months to one year, unlike recent sessions when trading was concentrated in papers of up to two months," a dealer at a public-sector bank said. "Investors showed greater interest in longer-tenor instruments, which supported volumes." 

The net liquidity absorbed by the Reserve Bank of India — a proxy for surplus liquidity — fell to INR 854 billion Monday from INR 1.39 trillion on Sunday, according to the latest data. The liquidity surplus narrowed as cash balances with the RBI rose to INR 8.90 trillion from INR 8.00 trillion, remaining well above the average balance requirement of INR 7.91 trillion for the fortnight ending Jun. 15.

--Primary market
* Axis Bank, Bank of Baroda, Punjab and Sind Bank, Punjab National Bank, and DCB Bank raised funds via CDs

* Larsen & Toubro, HDFC Securities, Kotak Securities, Axis Securities, Akara Capital Advisors, National

  Bank for Agriculture and Rural Development, L&T Finance, Motilal Oswal Financial Services, IGH Holdings,    Aditya Birla Money, ICICI Securities, Godrej Industries, IIFL Finance, Trust Investment Advisers, YES      Securities, and Phillip Finance and Investment Services India were among those that raised funds via CPs

--Secondary market

* Union Bank of India's CD maturing Wednesday was traded nine times at a weighted average yield of 5.20%
* Bajaj Finance Ltd.'s CP maturing Wednesday was traded twice at a weighted average yield of 5.18%

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1700 IST, as detailed on CCIL's F-TRAC platform:

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Saji George Titus

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