The document discusses India's debt markets, which comprise government securities and corporate bonds. It notes that government securities dominate in terms of outstanding securities, market capitalization, and trading volume. Corporate bonds include those issued by public and private corporations. While government securities are the benchmark, corporate bonds generally offer higher yields but also higher risks. The debt market has grown in recent years, with increasing issuances and a more diverse set of investors and instruments. However, further development is needed, including improving secondary market liquidity and addressing regulatory overlap.
Capital Market is divided into two division; Primary Market and Secondary Market. Primary Market and its components are briefly described in this presentation.
A project on derivatives market in indiaProjects Kart
A project on derivatives market in India report goes beyond that the local derivative in the emerging markets have witnessed widespread use of the derivative instrument for a variety of reasons. This continuous growth and development by the emerging market participants has resulted in capital inflows as well as helped the investors in risk protection through hedging. Visit: http://www.projectskart.com/p/contact-us.html for more information.
Capital Market is divided into two division; Primary Market and Secondary Market. Primary Market and its components are briefly described in this presentation.
A project on derivatives market in indiaProjects Kart
A project on derivatives market in India report goes beyond that the local derivative in the emerging markets have witnessed widespread use of the derivative instrument for a variety of reasons. This continuous growth and development by the emerging market participants has resulted in capital inflows as well as helped the investors in risk protection through hedging. Visit: http://www.projectskart.com/p/contact-us.html for more information.
"This presentation covers the fundamentals of the Indian capital markets. It includes a briefing on the various instruments available for fund raising and investing. It will help you understand the basics of shares, debentures, bonds, commodities and other instruments".
This is the comprehensive and latest presentation on Indian Corporate Bond market. It starts with basic features, 3 Main pillars of Indian Corp bond market ecosystem & its importance. It then covers Primary Placement, Valuation/MTM as per RBI/FIMMDA norms, Valuation using excel IRR() function with example, Credit rating scales, Market timing & Reporting.
It also covers few topics like ISIN & ends with challenges and Limitation of India corp bond market.
"This presentation covers the fundamentals of the Indian capital markets. It includes a briefing on the various instruments available for fund raising and investing. It will help you understand the basics of shares, debentures, bonds, commodities and other instruments".
This is the comprehensive and latest presentation on Indian Corporate Bond market. It starts with basic features, 3 Main pillars of Indian Corp bond market ecosystem & its importance. It then covers Primary Placement, Valuation/MTM as per RBI/FIMMDA norms, Valuation using excel IRR() function with example, Credit rating scales, Market timing & Reporting.
It also covers few topics like ISIN & ends with challenges and Limitation of India corp bond market.
Nidhi company rules 2014 an analysis w.r.t. nidhi company registrationEquiCorp Associates
With the implementation of new rules for operations of Nidhi Company, into effect from April 01, 2014, what will be fate of the public deposit schemes? How these Rules, 2014 are going to impact the Indian Financial Sector, especially Nidhi Companies in India? Nidhi Companies are created mainly for cultivating the habit of thrift and savings amongst its members. The amount of business conducted by Nidhi Companies is not as big as commercial banks or deposit taking Non-Banking Finance Companies. Nidhi Companies are highly localized and mostly single office institutions. They are also referred to as mutual benefit societies, because they accept deposits and give loans to only their own members; and membership is limited to individuals.
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Finanacial Institutions Management and Administrationetebarkhmichale
1. Introduction
Gender equality is crucial for economic development, yet women still contribute only 37% of the global GDP, a persistent issue requiring ongoing efforts.
Africa's female entrepreneurs face a $42 billion financing gap, hindering their economic contribution due to limited resources, legal frameworks, and socio-cultural environments.
The Commercial Bank of Ethiopia is introducing a customer-centric business model, proposing a collateral-free loan product for women-owned small businesses, to address the financing gap and promote financial inclusion in Ethiopia's 49.8% female population.
2. Objectives of the proposal
2.1. General Objectives
The general objective of this proposal is to ensure sustainably growing profit and equitable resource allocation by offering collateral-free loans to support selected growth-oriented women-owned enterprises.
2.2. Specific Objectives
• To play a proactive role in supporting and promoting women-owned enterprises by availing of useful and affordable loan products;
• To pilot collateral-free financing and improve the credit risk appetite of the bank;
• To realize enhanced customer experience through adapting and scaling up the collateral-free financing scheme;
• To realize the bank’s digital financing initiatives;
• To mobilize resources through aligning with different development partners who are working on promoting women's economic empowerment and access to finance;
• To diversify the product portfolio of the bank;
• To implement the provisions regarding micro- and small-enterprises lending aspects of the credit policy and procedures of the bank;
• To support the realization of the financial inclusion strategy of the country;
• To optimize the profitability of the bank by entering untapped and new market niches;
• To optimize the competition capability of the bank;
• To ensure customer satisfaction and retention by availing of tailor-made products with simple and accessible outreach options.
3. Target groups
4. Work flow
For this pilot, women entrepreneurs owning and operating an active business will be selected through a coalition with government organs and/or other parties that work with the entrepreneurs, train them, and involve them in skill development. When a selected applicant submits the loan request along with all the required documents to the bank, the credit department of the district (for this program, the central region district) will appraise and review the credit request either manually for conventional borrowers or using a credit scoring solution for digital borrowers. Based on the credit appraisal result and credit scoring solution determination, the applicant can get the approved amount of an unsecured micro loan. Indeed, the work flow can be described as follows:
• The selected women-owned microbusinesses lodged their requests at a branch or using their phones digitally.
• Legal documents like a TIN, trade registration and license, financial statements, sales contract
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Indian financial system which covers its elements, money market and capital market.it also coversd the instruments traded in money market and capital market in India.
Money market,Money Market Instruments,Call money,Treasury bill
Debt markets in India
1. Debt Markets In India
SIESCOMS
PGDM – B
Batch
2014-16 PGDM - B
Group
Members :
Khyati Cheda
– 66
Ashish
Sharma -85
2. Introduction to Debt Markets
• Debt can be defined as an obligation to pay an amount
owed/borrowed.
• Debt markets refers to the financial market where
investors buy and sell debt securities mostly in the form
of Bonds.
• These Markets are important source of funds, especially
in a developing economy like India.
• Like all other countries, Debt Markets in India is
considered as a useful substitute to banking channel for
finance.
• A debt security is a tradeable form of loan.
• It is usually an obligation of the issuer of such
instrument as regards certain cash flows representing
principal and interest, where the issuer would have to
3. Indian Debt Markets
• The debt market in India comprises of two main
segments, viz., the Government securities market
and the corporate securities market, besides the
emerging market for interest rate derivatives.
• The market for government securities is the most
dominant part of the debt market in terms of the
outstanding securities, market capitalization, trading
volume and number of participants.
• It sets the benchmark for the rest of the market.
• The corporate debt segment includes private
corporate debt, bonds issued by public sector units
(PSUs) and the bonds issued by the Development
financial Institutions (DFIs).
• Some PSU bonds are tax free while most bonds,
including Government securities are taxable.
4. Indian Debt Market Structure
• In order to understand the entirety of the debt
market we will look at it through a framework
based on its main participants. These
participants are as follows:
• Instruments - the instruments are the
certificates issued in tradable form.
• Issuers - are entities, which issue these
instruments and are primarily corporate or the
Government.
• Investors - are entities, which invest in these
instruments or trade in these instruments.
• Regulators - The Debt regulators are RBI,
10. Calculation of Yield of Bonds
• Bond returns can be calculated in various ways
1. Coupon rate
2. Current yield
3. Yield to maturity(YTM)
• Coupon rate is the nominal rate of interest that is
fixed and is printed on the bond certificate which
is calculated on the face value of the bond.
• Current yield relates the annual interest
receivable on a bond to its current market price.
Current Yield = (Annual interest/Current market
price) *100
• Current yield > coupon rate, the bond is selling at
a discount
• Current yield < coupon rate, the bond is selling at
11. Yield to maturity (YTM)
• YTM is the internal rate of return earned on a bond
if held till maturity.
• It is the rate of return that an investor is expected to
earn on an annualized basis expressed in % terms
from a bond purchased at the current market price
and held till maturity.
• Approximate YTM may be calculated as
YTM= I+[(RV-MP)/N]
(RV+MP)/2
Where I –Annual interest/ payment
RV -Redemption value
MP-Market value
12. Bond Prices
• Intrinsic value of bond is equal to the present value
of all future cash flows discounted at the required
rate of return.
P0 = I*PVAF(r%,n) + RV*PVF(r%,n)
Where P0 - Present value of the bond
I - Annual interest payments
RV- Redemption value
r - Required rate of return
n - Number of years
13. Debt Instruments
Government Securities (G-Secs)
• RBI issues G-Secs On behalf of the
Government Of India
• These Securities have a maturity period of 1-30
years
• G-Secs offer fixed Interest rates where interest
is payable semi-anually
• For short term, there are T-Bills which are issued
by RBI for 91 days, 184 Days and 364 Days.
14. Corporate Bonds
• Corporate Bonds or Convertibles are private
sector debt instruments
• These bonds come from PSUs and Private
Corporations and are offered for an extensive
range of tenor up to 15 years
• There are also some perpetual bonds
• As compared to G-Secs, Corporate Bonds carry
higher risks which depend upon the
corporations, the industry where the corporation
is currently operating, the current market
conditions and the rating of the corporation.
15. Certificate of Deposit
• These are short term instruments issued by
commercial Banks and Specialized Financial
Institutions
• These are negotiable money market instruments
• CDs usually offer higher returns than Bank Term
Deposits, are issued in Demat form and also as
Usance Promissory Notes
• Banks offer CDs which have maturity between 7
days to 1 Year
• CDs from Financial Institutions have maturity
between 1 to 3 years
16. Commercial Papers
• These are popular instruments for financing
working capital requirements of Companies
• They are short term securities ranging from 7 to
365 days
• CPs are issued by corporate entities at a
discount to face value
• They are issued in the form of promissory notes
17. Zero Coupon Bonds
• Some bonds, called Zero Coupon Bonds, do
not pay out any interest prior to maturity
• These bonds are sold at a discount because
the value from the bond occurs at maturity
when the principal is returned to the
bondholder along with the interest
• One type of Zero Coupon Bond is a “Strip”
• The interest payment are separated from a
bond and multiple zero coupon securities are
created, one representing the principle
amount and one representing each coupon
18. RECENT DEVELOPMENTS
Reduce Concentration of issuers
— FSl sector issuers continue to dominate the market with over 75% of
volumes
— Top 10 issuers account for bulk of the total issuance
Improve liquidity in secondary market
— Introduce market making mechanism for corporate bonds
Revive the securitization market
— Alignment of tax rate to ease the issuance of Pass Through Certificates
(PTCs)
Further liberalize investment norms for PFs and insurance companies
— Boost demand for corporate bonds by allowing higher investments in non-
AAA/non-A1 + paper
— Increasing scope of investment by provident/pension/gratuity funds and
insurance companies
Increase Fll Inflows
— Allow higher degree of capital account convertibility and relaxation of
19. Overview of primary and secondary
bond market
Issuer Amount raised from
Primary Market (in Rs.
bn)
Turnover in Secondary
Market (in Rs. bn)
2010-11 2011-12 2010-11 2011-12
Corporate/Non-
government
2,017 2,871 1,592 1,761
Government 5,834 7,591 70,683 73,431
Total 7,851 10,462 72,274 75,191
20. Private placements of corporate
bonds
Issues
2010-11 2011-12
Amount of
Issue (Rs.
bn)
% of total
issues
Amt. of
Issue ( Rs.
bn)
% of total
issues
Public Issues 95 4.7 356 12.4
Private Placement 1,922 95.3 2,154 87.6
Total Issues 2,017 100 2,870 100
21. KEY MESSAGES
Strong growth in corporate bond issuances in recent times
— Corporate bond market issuances increased seven-fold over
the last decade
Expanding issuer and investor base
— Increase in issuer base, primarily driven by private sector
issuers
— Significant growth in investments by Flls and Mutual Funds in
corporate bonds
Increasing sophistication
— Several innovations in recent times: Inflation-indexed
debentures. Basel lll bond,
50-year bond, infrastructure debt fund
Enabling regulatory initiatives
— Concerted efforts from all financial market regulators
22. The way Forward
• The issue of Regulatory Overlapping should be
addressed
• Need of Simple Products
• Increase Liquidity in Secondary Market
• Tax Incentives
• Procedural ease for Companies listed on any
exchange in India
• Rationalization of Stamp Duty
• Appointment of Market Makers in Corp Bond
Market