**Policy Summary: Reissue of 7.72 Percent Government Stock 2055**
On November 7, 2016, the Government of India, Ministry of Finance, Department of Economic Affairs, announced the sale and reissue of the 7.72 percent Government Stock 2055 for an aggregate amount of ₹3,000 crore nominal. This sale will adhere to the terms and conditions outlined in this specific notification and the General Notification F. No. 4(13)WM2008, dated October 8, 2008.
The stock will be sold through the Reserve Bank of India (RBI), Mumbai Office, Fort, Mumbai – 400 001, via a price-based auction using the multiple price auction method, as detailed in paragraph 5.1 of the General Notification. Up to 5% of the notified amount will be allotted to eligible individuals and institutions through a non-competitive bidding facility.
The auction was conducted by the RBI, Mumbai Office, on November 11, 2016. Bids were submitted electronically via the RBI's e-Kuber system on the same date. Non-competitive bids were accepted between 10:30 a.m. and 11:30 a.m., while competitive bids were accepted between 10:30 a.m. and 12:00 noon. The stock was eligible for When Issued trading, following RBI guidelines.
The Government Stock has a tenure of 40 years, commencing from October 26, 2015, and will be repaid at par on October 26, 2055. The result of the auction was displayed by the RBI at its Fort, Mumbai Office on November 11, 2016. Payment by successful bidders was due on November 15, 2016, the date of reissue, and included accrued interest from October 26, 2016, to November 14, 2016.
Interest at a rate of 7.72 percent per annum accrues on the nominal value of the stock from the last coupon payment date and is paid semi-annually on April 26 and October 26.
Contact: Reserve Bank of India, Mumbai Office, Fort, Mumbai – 400 001.
Key Entities Referenced
Ministry of Finance: The ministry responsible for economic and financial matters in the Government of India.
Department of Economic Affairs: A department within the Ministry of Finance responsible for advising the government on economic issues.
7.72 Percent Government Stock 2055: A government security with a fixed interest rate of 7.72% that matures in 2055.
Reserve Bank of India: The central bank of India, responsible for managing the country's monetary policy and regulating the banking system.
Mumbai Office, Fort, Mumbai, Maharashtra: The Mumbai office of the Reserve Bank of India, located in the Fort area of Mumbai.
General Notification F. No. 4 13WM2008: A general notification issued by the Government of India related to government stock.
Scheme for Noncompetitive Bidding Facility in the Auctions of Government Securities: A scheme that allows eligible individuals and institutions to bid for government securities without competing on price.
Prashant Goyal: Joint Secretary to the Government of India, signatory of the notification.
Government of India
Ministry of Finance
Department of Economic Affairs
Budget Division
New Delhi, dated November 07, 2016
NOTIFICATION
Auction for Sale (Re-issue) of 7.72 Percent Government Stock 2055
F. No.4 (3) W&M/2015(iii): Government of India hereby notifies sale (re-issue) 7.72 percent Government
Stock 2055 of for an aggregate amount of ` 3,000 crore (nominal). The sale will be subject to the terms
and conditions spelt out in this notification (called ‘Specific Notification’) as also the terms and conditions
specified in the General Notification F. No. 4 (13)–W&M/2008, dated October 8, 2008 issued by
Government of India.
Method of Issue
2. The Stock will be sold through Reserve Bank of India, Mumbai Office, Fort, Mumbai- 400 001 in the
manner as prescribed in paragraph 5.1 of the General Notification F. No. 4 (13)–W&M/2008, dated
October 8, 2008 by a price based auction using multiple price auction method.
Allotment to Non-competitive Bidders
3. The Government Stock up to 5% of the notified amount of the sale will be allotted to eligible individuals
and institutions as per the enclosed Scheme for Non-competitive Bidding Facility in the Auctions of
Government Securities (Annex).
Place and date of auction
4. The auction will be conducted by Reserve Bank of India, Mumbai Office, Fort, Mumbai-400 001 on
November 11, 2016. Bids for the auction should be submitted in electronic format on the Reserve Bank
of India Core Banking Solution (E-Kuber) system on November 11, 2016. The non-competitive bids
should be submitted between 10.30 a.m. and 11.30 a.m. and the competitive bids should be submitted
between 10.30 a.m. and 12.00 noon.
When Issued Trading
5. The Stock will be eligible for “When Issued” trading in accordance with the guidelines issued by the
Reserve Bank of India.
Tenure
6. The Government Stock will be of ’40 year’ tenure commencing from October 26, 2015. The Stock will
be repaid at par on October 26, 2055.
Date of issue and payment for the stock
7. The result of the auction shall be displayed by the Reserve Bank of India at its Fort, Mumbai Office on
November 11, 2016. The payment by successful bidders will be on November 15, 2016 i.e. the date of
re-issue. The payment for the Stock will include accrued interest on the nominal value of the Stock
allotted in the auction from the date of last coupon payment i.e. October 26, 2016 to November 14, 2016
Interest
8. Interest at the rate of 7.72 per cent per annum will accrue on the nominal value of the Stock from the
date of last coupon payment and will be paid half-yearly on April 26 and October 26.
By Order of the President of India
(Prashant Goyal)
Joint Secretary to the Government of India