RBI announces special OMO of Rs 20,000 crore in 2 tranches

New Delhi: The Reserve Bank of India on Tuesday said it will conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO) for an aggregate amount of Rs 20,000 crore in two tranches.

"On a review of current and evolving liquidity and market conditions, the Reserve Bank has decided to conduct simultaneous purchase and sale of government securities under Open Market Operation (OMO) for an aggregate amount of ₹20,000 crores in two tranches of ₹10,000 crores each. The auctions would be conducted on August 27, 2020 and September 03, 2020," the RBI said.

The Reserve Bank said that it reserves the right to decide on the quantum of purchase/sale of individual securities; accept bids/offers for less than the aggregate amount; purchase/sell marginally higher/lower than the aggregate amount due to rounding-off; and accept or reject any or all the bid/offers either wholly or partially without assigning any reasons.

Eligible participants will have to submit their bids/offers in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system on August 27, 2020. RBI said, only in the event of system failure, physical bids/offers would be accepted. Such physical bid/offer should be submitted to Financial Markets Operations Department in the prescribed form obtainable from RBI website.

The result of the auctions will be announced on the same day and successful participants should ensure availability of funds/securities in their Current account/SGL account, as the case may be, by 12 noon on August 28, 2020.

The securities for the second tranche auction on September 03, 2020 will be announced separately.

The Reserve Bank will continue to monitor evolving liquidity and market conditions and take measures as appropriate to ensure orderly functioning of financial markets.