Industry

FBIL will now do the valuation of G-Secs

It takes over the responsibility from FIMMDA.

Financial Benchmark India Pvt. Ltd. (FBIL) will now be responsible for administering the valuation of Government securities.

FBIL will take over this responsibility from March 31.

Hitherto, Fixed Income Money Market and Derivatives Association of India (FIMMDA), an association of commercial banks, financial institutions and primary dealers, has been responsible for administering the valuation of government securities issued by both the Central and State Governments.

FBIL will take over these responsibility from FIMMDA.

``From that date (March 31), FIMMDA shall cease to publish prices/yield of Government securities and this role shall be taken over by FBIL. FBIL will commence publication of the G-Sec and SDL valuation benchmarks based on the extant methodology. Going forward, FBIL will undertake a comprehensive review of the valuation methodology,’’ said a release from the Reserve Bank of India.

``RBI regulated entities, including banks, non-bank financial companies, primary dealers, co-operative banks and all-India financial institutions who are required to value Government securities using prices published by FIMMDA as per current directions may use FBIL prices with effect from March 31, 2018. Other market participants who have been using Governemnt securities prices/yields published by FIMMDA may use the prices/yields published by FBIL for valuation of their investment portfolio,’’ the release said.

This is line with the announcement made as part of the sixth bi-monthly monetary policy statement for 2017-18 dated February 7, 2018. The apex bank had announced then that FBIL would assume the responsibility for administering the valuation of Government securities (issued by both the Centre and States) currently being done by FIMMDA.

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Printable version | Feb 18, 2020 10:02:33 AM | https://www.thehindu.com/business/Industry/fbil-will-now-do-the-valuation-of-g-secs/article23402030.ece

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