New Delhi: In another development, the Reserve Bank of India (RBI) on Monday announced second Targeted Long Term Repo Operation (TLTRO). Also Read - What is RBI's 3-Month Moratorium? Will EMI be Deducted From Your Account? Here Are Your Answers
Issuing a statement, the RBI said it will conduct the Targeted Long Term Repo Operation (TLTRO) up to 3 years of appropriate sizes for up to Rs 1 lakh crore. Also Read - RBI Recruitment 2020: Applications Invited For Consultants, Specialists, Analysts; Apply From April 9
As per updates, the first tranche of TLTRO for Rs 25,000 crores was conducted on March 27 and another TLTRO of Rs 25,000 crores will be conducted on April 3. Also Read - RBI's Covid-19 Package: Here's How You Will be Benefitted | Explained
The RBI said the funds availed under this facility would have to be deployed within 15 working days from the date of the operation. “A declaration to this effect would need to be submitted within one month to Financial Markets Operations Department (email) and to Department of Supervision (email),” it said.
Saying that the operations would be conducted at the policy rate prevailing at the time of the operation, the RBI said the interest rate on TLTROs would be floating and linked to the policy rate. “Other operational guidelines for TLTROs would remain the same as LTROs,” it said.
The RBI has also extended Fixed Rate Reverse Repo and Marginal Standing Facility (MSF) window to provide eligible market participants with greater flexibility in their liquidity management.
“From March 31 till April 30, the Fixed Rate Reverse Repo and MSF each will function from 9 AM to 11:59 PM,” the RBI said in a statement.
Last week, the RBI lowered the key repo rate by 75 basis points to 4.4 per cent in a bid to arrest the economic slowdown amid coronavirus (COVID-19) outbreak.
According to updates, the reverse repo rate now stands at 4 per cent, down by 90 basis points. RBI Governor Shaktikanta Das said this has been done to make it unattractive for banks to passively deposit funds with the central bank and instead lend it to the productive sectors.