Debt Market Instruments

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Debt Market Instruments

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About Debt Instruments

The HDFC Bank Money Market Desk helps you balance risk, returns and liquidity on your fund with a variety of debt instruments. These include government securities, treasury bills or T-Bills and commercial paper.

Types Of Instruments Offered

Types Of Instruments Offered

Based on your liquidity needs and risk appetite you can choose any of these security types:

Government of India Securities

These are sovereign-backed (credit risk-free) coupon bearing instruments which are issued by the Government of India. The main features of these bonds are:

  • Fixed coupon paid on specific dates on half-yearly basis
  • Wide range of maturity dates, from short-dated (less than one year) to long-dated (up to twenty years)
  • Available in the primary and secondary markets
  • Liquid securities can be sold in the secondary market at prevailing rates
  • Available in physical form and demat which can be held in a Constituents Subsidiary General Ledger (CSGL) account with any bank
  • If you hold your securities in a CGSL account, get automatic credit of half-yearly interest and the redemption proceeds on due date.
  • Enjoy reasonably good returns

 

Treasury Bills

T-Bills are instruments issued at a discount to the face value by the Central Government. The main features of Treasury Bills are:

  • Sovereign-backed zero-risk instruments
  • Short term, discounted Instruments with a maximum tenure of 364 days
  • Available in the primary and secondary markets
  • Issued at a discount to face value – for example, if a T-Bill has a face value of Rs 100, it is issued at a discount; you get the face value on maturity.
  • No Tax Deduction at Source (TDS)
  • If you hold your securities in a CGSL account, get automatic credit of half-yearly interest and the redemption proceeds on due date.
  • Highly liquid
  • Enjoy attractive returns.

 

Commercial Paper

These are short-term unsecured promissory notes issued by leading companies, primary dealers(PDs), satellite dealers(SDs) and all-India financial institutions(FIs). The main features of these papers are:
 

  • Corporates with tangible net worth of not less than Rs 4 crore and whose borrowal account is classified as Standard Asset by financing banks, are eligible to issue CPs
  • All CPs must have a credit rating. The highest rating is P1+ and lowest is P-2 by CRISIL.
  • Minimum period of 15 days and a maximum up to one year.
  • Minimum amount of investment is Rs 5 lakh or multiples thereof
  • Issued at a discount to face value.
  • Compulsory demat
  • Enjoy attractive returns

 

For more details, write to us at mmdesk.bombay@hdfcbank.com

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