RBI panel discusses steps to encourage retailers in GSec mkt

RBI's technical advisory committee today discussed introduction of interest rate options, credit default swaps and repo in corporate bonds with a view to encourage retail participation and deepen financial markets.
The first meeting of the reconstituted Technical Advisory Committee (TAC) on Financial Markets was held today, under the chairmanship of RBI Deputy Governor H R Khan.
Besides other things, the TAC also reviewed the recent developments in money market, government securities market and forex market.
According to RBI, the "introduction of products like interest rate options and steps required to activate the use of products like Separate Trading of Registered Interest and Principal Securities (STRIPS), Credit Default Swaps (CDS) and repo in corporate bonds" were discussed.

The RBI in its policy review earlier this month had underlined the need for introduction of new products to encourage retail participation in government securities market.
The 17-member TAC includes representatives from the Finance Ministry, Sebi,and banking, insurance and mutual fund industry, among others.
The terms of reference of the TAC includes recommending measures for deepening and widening the money, foreign exchange and government securities markets. They would also suggest measures for development of market and promote liquidity in those markets.
The Committee would meet at least once in a quarter and would function for two years from the date of its first meeting.