Government of Maharashtra: Bonds with 11, 16, and 21-Year Maturities Worth ₹1,500 Crore Available for Sale

Mumbai : The Government of Maharashtra will be auctioning ₹1,500 crore worth of bonds with an 11-year maturity, as per the terms and conditions outlined in the notification dated May 16, 2019. According to Finance Department Secretary Shaila A., the funds raised through this bond issuance will be used for the government’s development programs.

Ten percent of the bond amount (revised) will be allotted to eligible individual and institutional investors through a non-competitive auction method, with a maximum of one percent of the total notified amount being allotted to a single investor. The Reserve Bank of India (RBI) will conduct the auction at its Mumbai office on September 3, 2024. Bids are to be submitted on the same day through the RBI’s Core Banking Solution, the e-KUBER system.

Competitive bids must be submitted 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 published on the RBI website later that day. Successful bidders must make payments on September 4, 2024, using cash, banker’s cheque, payment order, demand draft, or checks payable to their account at the RBI, Mumbai, before the close of bank business hours.

The debentures have a term of 11 years, maturing on September 4, 2035. The interest rate will match the coupon rate per annum on the bonds sold in the auction, with interest paid semi-annually on March 4 and September 4 each year.

Investments by banks in these government securities will qualify for the Statutory Liquidity Ratio (SLR) under Section 24 of the Banking Regulation Act, 1949. The Finance Department has also informed that these bonds will be permissible for resale and purchase.

Similarly, the Government of Maharashtra will auction ₹1,500 crore worth of bonds with 16-year and 21-year maturities, under the same terms and conditions outlined in the May 16, 2019 notification. The auctions will also be conducted by the Reserve Bank of India on September 3, 2024, through the e-KUBER system.

The 16-year bonds will mature on September 4, 2040, and the 21-year bonds on September 4, 2045. Both will offer interest at the coupon rate per annum, with semi-annual payments on March 4 and September 4 each year. The government aims to use the proceeds from these bonds for ongoing development programs.

The Finance Department has reiterated that banks’ investments in these securities will qualify for SLR under Section 24 of the Banking Regulation Act, 1949, and these bonds will be available for resale and purchase in the secondary market.

Ten percent of the revised bond amount will be allocated to eligible individual and institutional investors through a non-competitive auction method. However, a maximum of one percent of the total notified amount will be allocated to any single investor. The auction will be conducted by the Reserve Bank of India at its Mumbai office on September 3, 2024. Auction bids must be submitted on the same day through the RBI’s Core Banking Solution, the e-KUBER system.

Competitive bids should be submitted via 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 published on the Reserve Bank of India’s website later that day. Payments from successful bidders must be made by September 4, 2024, using cash, banker’s cheque, payment order, demand draft, or checks payable to their account at the Reserve Bank of India, Mumbai, before the close of bank business hours.

The debentures have a 21-year term, beginning on September 4, 2024, and maturing on September 4, 2045. The interest rate will match the coupon rate per annum on the bonds sold in the auction, with interest paid semi-annually on March 4 and September 4 each year.

Banks’ investments in these government securities will be eligible for the Statutory Liquidity Ratio (SLR) under Section 24 of the Banking Regulation Act, 1949. The Finance Department has also informed that these bonds will be permissible for resale and purchase.