Regulatory Alerts2012-07-29
Added · Updated
DMD Circular No. 07: Rationalization of Investment of Scheduled Banks in Government Securities
The document establishes a mandatory allocation procedure for unsubscribed Treasury bills and bonds from auctions, requiring that 60% of the unsubscribed amount be distributed among twelve Primary Dealer (PD) banks and the remaining 40% among twenty-five specified non-PD banks. For PDs, half of their allocated portion is assigned based on underwriting obligations calculated via total demand and time liabilities, while the other half is distributed equally; non-PD banks receive their share proportionally based on their individual share in total demand and time liabilities. This circular replaces DMD Circular No. 06 dated 24 July 2012 and becomes effective on 1 August 2012.
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