RBI set the cut-off commissions for the government securities underwriting auction on June 12.
The Reserve Bank of India has set the underwriting commission cut-off rates for primary dealers for two Government of India securities in the additional competitive underwriting auction held on June 12, 2026. This process clarifies the terms of risk-bearing and bid participation before the issuance of government securities maturing in 2031 and 2066.
Highlights
- The underwriting obligation for 6.36% GS 2031 has been set at ₹21,000 crore, with the underwriting commission cut-off rate fixed at 0.25 paise per ₹100.
- For the underwriting of ₹11,000 crore for the 7.71% GS 2066, the commission cut-off was 0.61 paise per ₹100, reflecting a higher risk premium for the longer term.
- Underwriting results are directly linked to the execution of government borrowing in the June 12 auction, clarifying the risk pricing of primary dealers.
This article was translated from the original. Read the original version by our correspondent here.
Commission Levels for the June 12 Auction
Reserve Bank of India According to the Reserve Bank of India press release, for the 6.36% GS 2031, a minimum underwriting obligation of ₹10,500 crore was set on a notified amount of ₹21,000 crore, and ₹10,500 crore was accepted in additional competitive underwriting. A total of ₹21,000 crore was underwritten for this security, and the ACU commission cut-off rate was set at 0.25 paise per ₹100.For the 7.71% GS 2066, a minimum underwriting obligation of ₹5,502 crore was set on a notified amount of ₹11,000 crore. ₹5,498 crore was accepted in additional competitive underwriting, bringing the total underwritten amount to ₹11,000 crore, and the cut-off commission rate was 0.61 paise per ₹100.
Impact on Government Borrowing and the Market
An auction for the sale of these securities is also being held on the same day, directly linking the underwriting results to the execution of the government borrowing program. The different cut-off rates indicate that the risk pricing for primary dealers is determined based on maturity period and demand profile.The underwriting arrangement ensures smooth fulfillment of issuances in the government securities market, as primary dealers provide support for the notified borrowing. The higher commission rate for the long-term 7.71% GS 2066 security shows that the cost of risk-bearing is relatively higher for longer-duration papers.
Our previous report placed Prime Minister Narendra Modi’s continuous 4,399-day tenure in the broader context of India’s economic direction, policy reforms, and infrastructure investment. The same article also highlighted the government’s economic achievements, the decision not to join the RCEP on the trade policy front, and the potential impacts on domestic industries.
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