Rate Swaps

[sunandaC]

Rate Swaps

The Indian scene

Objective

• To further deepen the money markets

• To enable banks, primary dealers and all India financial institutions to hedge interest rate risks.

These guidelines are intended to form the basis for development of Rupee derivative products such as FRAs/IRS in the country. They have been formulated in consultation with market participants.


The guidelines are subject to review, on the basis of development of FRAs/IRS market.

Accordingly, it has been decided to allow scheduled commercial banks (excluding Regional Rural Banks), primary dealers and all -India financial institutions to undertake FRAs/IRS as a product for their own balance sheet management and for market making purposes.

Prerequisites

Participants are to ensure that appropriate infrastructure and risk management systems are put in place. Further, participants should also set up sound internal control system whereby a clear functional separation of trading, settlement, monitoring and control and accounting activities is provided.

 

[rosemarry2]

Rate Swaps

The Indian scene

Objective

• To further deepen the money markets

• To enable banks, primary dealers and all India financial institutions to hedge interest rate risks.

These guidelines are intended to form the basis for development of Rupee derivative products such as FRAs/IRS in the country. They have been formulated in consultation with market participants.


The guidelines are subject to review, on the basis of development of FRAs/IRS market.

Accordingly, it has been decided to allow scheduled commercial banks (excluding Regional Rural Banks), primary dealers and all -India financial institutions to undertake FRAs/IRS as a product for their own balance sheet management and for market making purposes.

Prerequisites

Participants are to ensure that appropriate infrastructure and risk management systems are put in place. Further, participants should also set up sound internal control system whereby a clear functional separation of trading, settlement, monitoring and control and accounting activities is provided.

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