ELIGIBILITY FOR READY FORWARD CONTRACTS

The following categories of entities are eligible to enter into ready forward contracts (market repos and not repos with the Reserve Bank of India (RBI) under the Liquidity Adjustment Facility) in the Government securities:

• persons or entities maintaining a Subsidiary General Ledger (SGL) account with the RBI, Mumbai, and
• the following categories of entities which do not maintain SGL accounts with the RBI but maintain gilt accounts with a bank or any other entity (i.e. the custodian) permitted by the RBI to maintain Constituent Subsidiary General Ledger Account with its Public Debt Office, Mumbai :
• Any scheduled bank;
• Any Primary Dealer
• Any non-banking financial company (other than Government companies)
• Any mutual fund
• Any housing finance company
• Any insurance company
• Any non-scheduled Urban Co-operative bank.
• Any listed company, having a gilt account with a scheduled commercial bank; and
• Any unlisted company which has been issued special securities by the Government of India and having gilt account with a scheduled commercial bank.
• In addition to the conditions and restrictions stipulated in circular dated May 11, 2005, the following restrictions will also be applicable to the eligible unlisted companies for entering into ready forward contracts:
• The eligible unlisted companies can enter into ready forward transactions as the borrower of funds in the first leg of the repo contract only against the collateral of the special securities issued to them by the Government of India; and
• The counter party to the eligible unlisted companies for repo transactions should be either a bank or a Primary Dealer maintaining SGL account with the Reserve Bank.