RBI conducts Variable Rate Reverse Repo Auction worth Rs 2,00,000 crore on July 29, 2022. The Reserve Bank of India will conduct 14 days Variable Rate Reverse Repo auction on July 29, 2022, under LAF. VRRR as the main liquidity management tool. Window Timing for auction is 10:30 AM to 11:00 AM.
Operational Guidelines for Auctions
The auction will be conducted on CBS platform called e-Kuber
The minimum bid amount for the auction would be Rupees one crore and multiples thereof.
Banks would be required to place their bids in percentage terms up to two decimal places. Successful bids will get accepted at their respective bid rates.
Bids at or above the repo rate will be rejected. Once the bidding time is over, all the bids would be arranged in ascending order of the rates quoted and the cut-off rate would be arrived at the rate corresponding to the notified amount of the auction. Successful bidders would be those who have placed their bids at or below the cut-off rate. All bids higher than the cut-off rate would be rejected.
There will be provision of pro-rata allotment should there be more than one successful bid at the cut-off rate.
RBI will, however, reserve the right to (i) absorb marginally higher amount than the notified amount due to rounding effects and (ii) absorb less than the notified amount without assigning any reasons therefor.
The reversal of the above auction would take place at the ‘start of day’ on the date of reversal. The eligible collateral and the applicable haircuts will remain the same as for LAF.
All other terms and conditions as applicable to LAF operations will also be made applicable to the above auction mutatis mutandis. These conditions will, however, be subject to review on a periodic basis.
