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Informist, Friday, Jun. 12, 2026

 

By Meera Nair

 

MUMBAI – Yield on three- and six-month certificates of deposits and commercial papers fell Friday due to sufficient liquidity in the banking system, dealers said. The net liquidity absorbed by the RBI – an indication of surplus liquidity in the banking system – was INR 1.59 trillion Thursday, up from INR 1.46 trillion Wednesday, according to the latest data.

 

In the secondary market, yields on AAA-rated CD fell 20 basis points in three-month and six-month segments while it remained unchanged in one year. The AAA-rated three-month CD fell to 6.80-6.85% from 7.00-7.05% Thursday. Six-month yields fell to 7.20-7.25% from 7.40-7.45% Thursday, while one-year yields were unchanged from 7.60-7.65% Thursday. Three-month and six-month rates fell back to Wednesday's levels. The three-month and nine-month segments were most traded Friday.

 

Meanwhile, yields on AAA-rated papers issued by non-banking financial companies also fell by 5 basis points in the three-month and six-month segments to 7.35-7.40% and 7.50-7.55% from 7.40-7.45% and 7.55-7.60%, respectively. The one-year segment was range bound at 7.80-7.85% Thursday. Mutual Funds remained the active buyers and sellers of the market. 

 

CD issuances rose to INR 63.90 billion as of 1740 IST, from INR 51.75 billion Thursday, according to data from the Clearing Corp of India Ltd. Only four banks tapped the primary market to raise funds. Axis Bank, Bank of Baroda, Central Bank of India, and Punjab and Sind Bank, were the only issuers in the CD primary market. 

 

Axis Bank raised INR 13.90 billion through an almost eight-month CD at a weighted average yield of 7.40%. Bank of Baroda raised INR 35 billion through an 88-day CD at a weighted average yield of 6.85%. Central Bank of India raised INR 12.00 billion at 6.96%, while Punjab and Sind Bank raised INR 3 billion at 6.98%. 

 

"The CD issuances were too low today (Friday) like Thursday as the books of mutual funds have reached almost full and this can be the same situation in the next week," a dealer at a brokerage firm said. 

 

Issuance of CPs rose to INR 185.87 billion as of 1754 IST Friday, compared with INR 122.30 billion Thursday. Major issuers included National Bank for Agriculture and Rural Development, Small Industries Development Bank of India, Godrej and Boyce Manufacturing Ltd., and Chennai Petroleum Corp. Ltd. Other CP issuers included Tata Realty and Infrastructure Ltd., Manappuram Finance Ltd., SBICAP Securities Ltd., Aditya Birla Housing Finance Ltd., Tata Housing Development Co. Ltd., and Cholamandalam Securities. 

 

NABARD raised INR 58.15 billion through 91-day CPs at a weighted average yield of 6.98%, while SIDBI raised INR 30 billion at 6.93%, according to data from the Clearing Corp of India. Godrej and Boyce Manufacturing Co. raised INR 7 billion at 7.25%, while Chennai Petroleum Corp. raised INR 5 billion at 6.23%.

 

In the secondary market, CD trading volume fell to INR 194.50 billion Friday, from INR 250.40 billion Thursday, according to CCIL data. CP trading volume rose to INR 150.75 billion from INR 120.90 billion Thursday.

 

--Primary market
* Axis Bank, Bank of Baroda, Central Bank of India, and Punjab and Sind Bank, raised funds via CD.

* NABARD, SIDBI, Godrej and Boyce Manufacturing Ltd., and Chennai Petroleum Corp. Ltd. Tata Realty and Infrastructure Ltd., Manappuram Finance Ltd., SBICAP Securities Ltd., Aditya Birla Housing Finance Ltd., Tata Housing Development Co. Ltd., and Cholamandalam Securities. were major issuers of CPs. 

 

--Secondary market

* Bank of Baroda's CD maturing Wednesday was traded twice at a weighted average yield of 6.24%
* NABARD's CP maturing Monday was traded 10 times at a weighted average yield of 5.20%

 

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1811 IST, as detailed on CCIL's F-TRAC platform:

 

Certificates of deposit		Commercial paper
Friday	Thursday	Friday	Thursday
194.50	250.40	150.75	120.90

 

End

 

Edited by Deepshikha Bhardwaj

 

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