CURRENT AFFAIRS

Detailed explanation-1: -In a first of its kind move Central Government has issued Rs 5, 500 crore in zero-coupon bonds to recapitalise Punjab and Sind Bank (P&SB) by allowing it to park the paper in its held-to-maturity (HTM) category at face value rather than the discounted market rate.

Detailed explanation-2: -In August, NBFCs such as TMF Holdings, Tata Motors Finance, Tata Capital Financial Services and L&T Finance raised an aggregate Rs 1, 683 crore via zero coupon bonds maturing in two years to four years. A clutch of non-banking financial companies (NBFCs) have issued zero coupon bonds to meet their funding requirements.

Detailed explanation-3: -The government, from time to time, issues bank recapitalisation bonds to public sector banks. These securities are named Special GoI security, are non-transferable and aren’t eligible investment and are held under held-to-maturity (HTM) portfolio without any limit.

Detailed explanation-4: -T-Bills, also known as zero coupon bonds, are issued by the RBI on the behalf of the cental government.

Detailed explanation-5: -Zero Coupon Bonds – Zero coupon bonds are bonds with no coupon payments. However, like T- Bills, they are issued at a discount and redeemed at face value. The Government of India had issued such securities in 1996.