The auction will be conducted on the Reserve Bank of India Core Banking Solution (E-Kuber) system. The government stock up to ten per cent of the notified amount of the sale of each stock will be allocated to eligible individuals and institutions subject to a maximum limit of one per cent of its notified amount for a single bid per stock as per the scheme for non-competitive bidding facility. Individual investors can also place bids as per the non-competitive scheme through the Retail Direct portal (https://rbiretaildirect.org.in).
The new state government stocks will bear interest at the rates determined by RBI at the auctions. For the new stock, interest will be paid half yearly on February 28 and August 30 of each year until maturity. For the re-issued Government Stock, interest will be paid at the rate as determined on the date of original issue of Government Stock and will be paid on a half yearly basis until maturity.
The Stocks will be governed by the provisions of the Government Securities Act, 2006 and the Government Securities Regulations, 2007.
In a press release, RBI said that the investment in State Government Stocks will be reckoned as an eligible investment in Government Securities by banks for the purpose of Statutory Liquidity Ratio (SLR) under Section 24 of the Banking Regulation Act, 1949.