The revised guidelines on External Commercial Borrowing are as per the updated circular of RBI as of December 22, 2023. In simple terms, External Commercial Borrowings (ECB) means commercial borrowings availed (in the form of bank loans, trade credits, and securitized instruments) from external sources (from abroad) with a minimum average maturity of three years.…
The Reserve Bank of India on Tuesday placed on its website the Report of the Working Group on State Government Guarantees. A guarantee, in law, is a contract to answer for the payment of some debt, or the performance of some duty, in the event of the failure of another primarily liable person. A government…
One of the important components of the international financial markets is the money market. Money Market is concerned with the issue and trading of securities with short-term maturities or quasi-money instruments. The Instruments traded in the money market are Treasury Bills, Certificates of Deposits (CDs), Commercial Paper (CPs), Bills of Exchange, and other such instruments…
Pari-passu is a Latin phrase used in contract law that means “equal footing”. Thus pari passu charge means, having equivalent charge/ rights or say charge-holders have equal rights over the asset on which pari-passu charge is created. Most of the large borrowers are financed by multiple banks in a consortium or under a Joint Lending…
A capital market is the part of a financial system concerned with raising capital by dealing in shares, bonds, and other long-term investments. Stock market (Share Market) is a place where buyers and sellers indulge in trade (buying/selling) of financial securities like bonds, stocks, etc. The trading is undertaken by participants such as individuals and…
RBI on Friday (January 5, 2024) issued revised Master circular in respect of Foreign Exchange Derivative Contracts, Overseas Commodity & Freight Hedging, Rupee Accounts of Non-Resident Banks and Inter-Bank Foreign Exchange Dealings etc. These directions lay down the modalities as to how the foreign exchange business has to be conducted by the Authorised Persons with…
In our previous article, we covered 100 terminologies used in the Forex Market. In this article we have covered 50 common terms used in the stock market and debt market like Arbitrage, ASBA, Asset allocation, Averaging down, Beta, Bid, Bid-Ask spread, Block chain stocks, blue chip stocks, P/E ratio, Bonus shares, Bull market, bear market,…
Updated as per RBI amended Master Direction dated June 04, 2024 KYC stands for “Know Your Customer”. It’s a process to prevent banks and other financial institutions from being used as a channel for Money Laundering (ML)/ Terrorist Financing (TF) and to ensure the integrity and stability of the financial system, efforts are continuously being…
[This post contains fundamental aspects of foreign exchange; and forex markets; as well as over 100 terminologies used in forex dealings such as direct and indirect Quote; buying rate, selling rate, forward exchange rate, swap rate, spot rate, cross rate, transaction date, value date, Spread, premium, discount, points, arbitrage, Interest arbitrage, Interest parity, future, hedging,…
The Reserve Bank of India (RBI) in its Notification No.FMRD.DIRD.10/14.02.001/2023-24 dated January 03, 2024, introduced certain changes in the Master Direction norms relating to Commercial Paper and Non-Convertible Debentures of original or initial maturity up to one year. The new direction is effective from April 1, 2024. Commercial Paper (CP) is an unsecured money market…