RBI sets interest rate on floating rate bonds-2012 at 7.08 per cent

08 Nov 2010

1

The Reserve Bank of India (RBI) has set the rate of interest on the floating rate bonds maturing in 2012 for the year (10 November 2010 to 9 November 2011) at 7.08 per cent per annum.

The variable base rate based on the average rate of the implicit yields at cut-off prices of the last three auctions of Government of India 364-day treasury bills worked out to 6.99 per cent. The interest spread at the auction held on 7 November 2003 was (+) 0.09 (plus 0.09) per cent. The coupon rate has been fixed accordingly.

The annual rate of interest on the FRB-2012 was set at a spread (as decided in the auction held on 7 November 2003) over and above the variable base rate. The variable base rate for payment of interest is the average rate of the implicit yields at cut-off prices of the last three auctions of Government of India 364-day Treasury Bills held to maturity.

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