Description:
RBI/2009-10/196
UBD (PCB) BPD Cir No. 17/13.01.000/2009-10
October 28, 2009
Chief Executive Officer of
All Primary (urban) Cooperative Banks
Dear Sir/ Madam
Guidelines on Exchange Traded Interest Rate Futures (IRFs) – UCBs
It has been decided to introduce Interest Rate Futures on a notional coupon bearing 10-year Government of India security. In this regard, Reserve Bank of India has issued a direction FMD.MSRG. 1/02.04.003/2009-10 dated August 28, 2009 under section 45 W of the Reserve Bank of India Act, 1934, which has been placed on the Reserve Bank of India website (www.rbi.org.in). A copy of the Direction is enclosed.
2. Accordingly, UCBs may participate in the designated interest rate futures exchanges recognized by SEBI, as clients, subject to RBI / SEBI guidelines in the matter only for the purpose of hedging their underlying exposures. The guidelines on Exchange Traded Interest Rate Futures are furnished in the Annex I .
3. In this connection, it is clarified that banks are not allowed to undertake transactions in IRFs on behalf of clients.
4. UCBs participating in IRF exchanges may submit the data in this regard on a monthly basis, in the proforma enclosed (Annex II) to the Regional office concerned within a fortnight of the succeeding month.
Yours faithfully,
(A. K. Khound)
Chief General Manager
Encl: as above #pdf
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