**Policy Summary: Reissue of 7.72 Percent Government Stock 2055**
On January 4, 2016, the Government of India, Ministry of Finance, Department of Economic Affairs, announced the sale reissue of the 7.72 percent Government Stock 2055 for an aggregate amount of ₹2,000 crore nominal. The sale was conducted by the Reserve Bank of India (RBI), Mumbai Office, through a price-based auction using the multiple price auction method, as outlined in General Notification F. No. 4(13)WM2008, dated October 8, 2008.
Up to 5% of the notified amount was allotted to eligible individuals and institutions via a non-competitive bidding facility. The auction took place on January 8, 2016, with non-competitive bids submitted between 10:30 a.m. and 11:30 a.m., and competitive bids between 10:30 a.m. and 12:00 noon on the RBI's e-Kuber system.
The stock is eligible for When Issued trading, as per RBI guidelines, and has a tenure of 40 years, commencing from October 26, 2015, with repayment at par on October 26, 2055. The auction results were displayed by the RBI on January 8, 2016, and payment by successful bidders was due on January 11, 2016, the date of reissue. This payment included accrued interest from October 26, 2015, to January 10, 2016.
Interest at a rate of 7.72 percent per annum accrues on the nominal value from the original issue date, payable 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 specific government bond being reissued, maturing in 2055 with an interest rate of 7.72%.
Reserve Bank of India: The central bank of India, responsible for conducting the auction and managing government securities.
Mumbai, Maharashtra: The city in Maharashtra where the Reserve Bank of India office is located and the auction will be conducted.
General Notification F. No. 4 13WM2008: A general notification issued by the Government of India providing guidelines for government stock auctions.
Scheme for Noncompetitive Bidding Facility in the Auctions of Government Securities: A scheme allowing eligible individuals and institutions to bid for a portion of the government stock without competitive bidding.
Prashant Goyal: Joint Secretary to the Government of India, signing the notification.
Government of India
Ministry of Finance
Department of Economic Affairs
Budget Division
New Delhi, dated January 4, 2016
NOTIFICATION
Auction for Sale (Re-issue) of 7.72 Percent Government Stock 2055
F. No.4 (2) W&M/2015(iv): Government of India hereby notifies sale (re-issue) 7.72 percent
Government Stock 2055 of for an aggregate amount of ₹ 2,000 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
January 8, 2016. Bids for the auction should be submitted in electronic format on the Reserve Bank
of India Core Banking Solution (E-Kuber) system on January 8, 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 January 8, 2016. The payment by successful bidders will be on January 11, 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 original issue i.e October 26, 2015 to January 10, 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 original issue 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