364-day t-bills, Financial Management

364-Day T-Bills

The Government considered that it is important to develop government securities market for monetary control. It also had an intention to ensure that government's credit needs are met more and more directly from the market instead of pre-emption of deposit resources. With this view, treasury bill was developed as a monetary instrument with market related rates. As a part of the overall development of Government securities market, the Government of India proposes to float treasury bills of varying maturities up to 364 days on auction basis.

The Government, with an intention to stabilize the money market in the country, introduced the 364-day T-bills on 28th April, 1992. The RBI neither discounted these bills nor participated in the auction. 364-day T-Bills are auctioned fortnightly, but the amount, however, is not notified in advance. These T-bills have become popular due to their higher yield coupled with liquidity and safety. The yield on 364-day T-bills is used as a benchmark by the financial institutions such as IDBI, ICICI, etc., for determining the rate of interest on floating bonds/notes. These bills widened the scope of money market and provided an innovative outlet for surplus funds. The introduction on treasury bills of varying maturities would offer investors a wider choice for investing in different instruments and thereby foster the development of Government securities market.


Posted Date: 9/11/2012 4:10:22 AM | Location : United States

Related Discussions:- 364-day t-bills, Assignment Help, Ask Question on 364-day t-bills, Get Answer, Expert's Help, 364-day t-bills Discussions

Write discussion on 364-day t-bills
Your posts are moderated
Related Questions
Q. How to develop career strategy? in this step employees need to focus on developing the knowledge experience and skills necessary to market self to prospective organizations.

What are the differences between life insurance and property and causality insurance? Life insurance prevents against death, retirement and illness. Companies obtain premiums b

Scenario: You are still a consultant for the Excellent Consulting Group. You have completed the first assignment, developing and testing a forecasting method based on linear regres

You deposit $500 today in a savings account that pays 3.5% interest, compounded annually. How much will your account be worth at the end of 25 years?

What do you meant by market-based and bank-based financial systems? Market-based versus bank-based financial systems implications. The presence of market-based and bank-base

Procedure of measurement of Future Value If we are getting a return of 10 % in one year then what is the return we are going to get in two years? 20 %, right. What about return

Debit Credit Accounts receivable $300,000 Allowance for doubtful accounts $35,000 Sales for 2010 were $5,500,000. All sales were sales on account. At the end of each month

Corporate Governance features Corporate compliance: The BOD should make sure that corporation obeys with all related laws, governance practices, regulations, accounting an

Company Z has just been organized. It is expected to experience zero growth next year and grow at a 10% rate in year 2.  Beginning in the third year the company should attain a 5%

What is Planning Internal auditors must plan the audit work so as to perform the audit in an effective manner.There must be sufficient audit programmes in existence which set o