Sale of Maharashtra Government Bonds with Maturities of 10, 15, 20, and 25 Years

Mumbai : The Maharashtra Government will auction bonds worth Rs. 1,500 crores with a tenure of 10 years, subject to the terms and conditions specified on May 16, 2019. The funds raised through this auction will be utilized for the state’s development programs, as informed by Finance Department Secretary Shaila A. through a press release.

According to the (revised) non-competitive bidding method, 10% of the bond amount will be allocated to eligible individual and institutional investors. However, no single investor will be allowed to bid for more than 1% of the total notified amount. The auction will be conducted by the Reserve Bank of India at its Mumbai office on August 27, 2024. Bids must be submitted on August 27, 2024, through the RBI’s e-Kuber system, the Core Banking Solution.

Competitive bids should be submitted electronically through the e-Kuber system between 10:30 AM and 11:30 AM, while non-competitive bids should be submitted between 10:30 AM and 11:00 AM. The auction results will be announced on the same day on the Reserve Bank of India’s website. Successful bidders are required to make payments on August 28, 2024, either in cash, banker’s cheque, payment order, demand draft, or cheques payable at the Reserve Bank of India’s Mumbai office before the end of business hours.

The bond tenure will be 10 years, starting from August 28, 2024, with full repayment due on August 28, 2034. The interest rate on the bonds will be determined by the coupon rate fixed during the auction. Interest payments will be made semi-annually on February 28 and August 28 each year.

Investment in these government bonds by banks will qualify as statutory liquidity ratio (SLR) under Section 24 of the Banking Regulation Act, 1949. The bonds will also be eligible for resale and repurchase, as informed by the Finance Department.

Additional Information for Other Bonds:

• 15-Year Bonds: The auction for 15-year bonds will follow the same process as described above, with the bond period beginning on August 28, 2024, and repayment due on August 28, 2039.
• 20-Year Bonds: The 20-year bonds will also follow the same auction process, with the bond period starting on August 28, 2024, and repayment due on August 28, 2044.
• 25-Year Bonds: The 25-year bonds will be auctioned similarly, with the bond period starting on August 28, 2024, and repayment due on August 28, 2049.

For all these bonds, the interest rates will be set during the auction, and semi-annual interest payments will be made on February 28 and August 28 each year. The Finance Department has confirmed that these bonds will be eligible for SLR purposes and can be resold or repurchased.