RBI allows banks to take trading positions in interest futures
Relaxing the norms for exchange- traded interest derivatives, the RBI on Monday allowed banks to take trading positions in the Interest Rate Futures.
By PTI |
MUMBAI: Relaxing the norms for exchange- traded interest derivatives, the Reserve Bank today allowed banks to take trading positions in the Interest Rate Futures (IRFs).
"It has now been decided to allow banks to take trading positions... in the IRFs", the central bank said in a communication to banks and financial institutions.
RBI had earlier in June 2003, permitted the banks to transact in IRFs for the purpose of hedging the risk in their underlying investment portfolio.
The apex bank had introduced the exchange-traded interest rate derivatives to enable banks to manage their risks in a better way.
Sebi had introduced trading of these derivatives instruments on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
However, while introducing the instruments in June 2003, the RBI had prohibited the banks from taking trading positions in futures.
"It has now been decided to allow banks to take trading positions... in the IRFs", the central bank said in a communication to banks and financial institutions.
RBI had earlier in June 2003, permitted the banks to transact in IRFs for the purpose of hedging the risk in their underlying investment portfolio.
The apex bank had introduced the exchange-traded interest rate derivatives to enable banks to manage their risks in a better way.
Sebi had introduced trading of these derivatives instruments on Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
However, while introducing the instruments in June 2003, the RBI had prohibited the banks from taking trading positions in futures.
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