The interest rate on Floating Rate Bonds, 2016 (FRB, 2016) applicable for the year (May 7, 2013 to May 6, 2014) will be 7.62% per annum, the Reserve Bank of India reported ( RBI) in a press release. Tuesday.
As a reminder, the 2016 FRB interest rate was set at an increase (as decided at the auction of May 6, 2004) in addition to the variable base rate.
The variable base rate for the payment of interest will be the average rate (rounded to two decimal places) of the returns implied at the closing prices of the three 364-day Treasury bill auctions immediately preceding the relative annual coupon reset date.
The variable base rate based on the average rate of the returns implied at the closing prices of the said last three auctions of 364-day T-bills was 7.58%.
The increase decided at the auction of May 6, 2004 was (+) 0.04 (plus 0.04). The coupon rate has been set accordingly.
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