Reference: Reserve Bank Of India
Update:
RBI announces Rate of Interest on Floating Rate Bonds, 2031:
The rate of interest on the Floating Rate Bonds, 2031 (FRB 2031) applicable for
the half year December 7, 2019 to June 6, 2020 shall be 6.10 per cent per annum.
It may be recalled that FRB, 2031 will carry a coupon, which will have a base rate
equivalent to the Weighted Average Yield (WAY) of last 3 auctions (from the rate
fixing day that is December 7, 2019) of 182 Day T-bills, plus a fixed spread (100 bps). The Weighted average yields will be computed by reckoning 365 days in a year. The coupon rate has been fixed accordingly.
Update:
Availability of National Electronic Funds Transfer (NEFT) System on 24×7 basis
RBI has decided that the above facility shall be made available from December 16,
2019 with the first settlement taking place after 00:30 hours on December 16, 2019 (i.e. night of December 15, 2019).
RBI has advised Member banks to take note of the following:
a. There will be 48 half-hourly batches every day. The settlement of first batch will
commence after 00:30 hours and the last batch will end at 00:00 hours.
b. The system will be available on all days of the year, including holidays.
c. NEFT transactions after usual banking hours of banks are expected to be automated
transactions initiated using ‘Straight Through Processing (STP)’ modes by the banks.
d. The existing discipline for crediting beneficiary’s account or returning the transaction
(within 2 hours of settlement of the respective batch) to originating bank will continue.
e. Member banks will ensure sending of positive confirmation message (N10) for all
NEFT credits.
f. All provisions of NEFT procedural guidelines will be applicable for NEFT 24×7
transactions as well.
Implication:
Member banks are expected to keep adequate liquidity in their current account with Reserve Bank of India at all times to facilitate successful posting of NEFT batch settlements.
Update:
Acquisition of financial assets by Asset Reconstruction Companies from sponsors and lenders:
RBI has decided that Asset Reconstruction Companies (ARCs) shall not acquire financial assets from the following on a bilateral basis, whatever may be the consideration
(i) a bank/ financial institution which is the sponsor of the ARC;
(ii) a bank/ financial institution which is either a lender to the ARC or a subscriber to the fund, if any, raised by the ARC for its operations;
(iii) an entity in the group to which the ARC belongs.
Implication:
ARCs may participate in auctions of the financial assets provided such auctions are conducted in a transparent manner, on arm’s length basis and the prices are determined by market forces.
Reference: Central Board of Indirect Taxes and Customs
Update:
GSTN has issued the list of CGST nodal officers for IT Grievance Redressal:
The list of CGST Nodal Officers for IT Grievance Redressal cab be accessed at the Link
Reference: Insurance Regulatory and Development Authority of India
Update:
GUIDELINES FOR INVESTMENT IN DEBT ETFs WITH CPSE BONDS AS UNDERLYING
The IRDAI (Investment) Regulations, 2016 read along with Investments – Master Circular Dt.3rd May, 2017 issued thereunder, permits Insurers to invest in the various exhaustive Asset categories. The IRDAI hereby permits Debt ETFs with underlying Debt Securities of Central Public Sector Enterprises (CPSEs) [herein after referred to as Debt ETFs] proposed to be launched in India, as eligible class of Investment, and as a part of “Mutual Fund” exposure.
All Exposure and Prudential Norms applicable for investments in Mutual Funds covered under Para 1.3 of Master Circular – Investments shall apply for investment made in Debt ETFs, in addition to the following conditions:
- The Debt ETFs shall be issued by Mutual Funds registered with SEBI and governed by SEBI (Mutual Funds) Regulations, 1996, as amended from time to time.
- The Debt ETF shall invest in a basket of Securities issued by CPSEs which are part of constituents’ of a publicly available index.
- The minimum investment by the Insurer shall not be less than Creation Unit size and it shall not be reduced to below Creation Unit Size.
- “All” Securities in the Index shall be complied with rating criteria as per Regulation 3 of IRDAI (Investment) Regulations, 2016 for it to part of “Approved Investment”. If any of the underlying securities gets downgraded below “AA”, the Debt ETF shall be automatically reclassified under “Other Investment”.
Implication:
Debt ETFs with underlying Debt Securities of Central Public Sector Enterprises (CPSEs) proposed to be launched in India, shall be treated as eligible class of Investment, and as a part of “Mutual Fund” exposure
Reference: General
Update:
Government amended IEPFA Rules, 2016, to simplify refund of claims
The Investor Education & Protection Fund (Accounting, Audit, Transfer and Refund) Rules 2016 have been amended to simplify the process of refund of claims filed with The Investor Education & Protection Fund Authority (the Authority).
Awareness creating messages are also disseminated from time to time through print and electronic media. The Authority launched a joint campaign of Investor awareness in association with RBI, SEBI and Department of Consumer Affairs. The Authority has also collaborated with Department of Telecommunications, Indian Institute of Corporate Affairs and Nehru Yuva Kendra Sangathan for achieving the objective of Investor Education and Protection.
Implication:
The amended rules inter-alia provide for digitisation with transparent and faceless processing of claims by the Authority. Compliances by companies have also been made time bound and system driven with rule based enforcement.
Update:
Extension of validity of directions-Shivam Sahakari Bank Ltd., Maharashtra:-
The Reserve Bank of India had stated that directions issued to Shivam Sahakari Bank Ltd., Ichalkaranji, Dist. – Kolhapur, Maharashtra vide directive DCBS.CO.BSD-I/D-6/12.22.351/2017- 18 dated May 18, 2018, shall continue to apply to the bank till 31st January 2020.
Implication:
The said bank will follow the directions issued by RBI for further period till 31st January 2020.
