Mumbai, April 23 In a bid to ease the liquidity strain caused due to Covid-19 outbreak and its subsequent economic fallout, the Reserve Bank of India on Thursday conducted a targeted long-term repo operation (TLTRO) worth Rs 25,000 crore.
In financial parlance, a TLTRO is a loan scheme for banks which come at the current repo rate from the RBI.
This type of operation is generally conducted to relieve the banks from some of their debt repayment obligations towards bond holders. Thus, it boosts cash flows emanating from the banking sector.
Market watchers have contended that such a move will have a durable impact on dealing with the economic fallout of the coronavirus.
In a statement, the apex bank said: "The first tranche of 'Targeted Long Term Repo Operation' (TLTRO) 2.0 for a notified amount of Rs 25,000 crore with a 3-year tenor in pursuance of the announcement made...."
"The total bids that were received amounted to Rs 12,850 crore, implying a bid to cover ratio (i.e., the amount of bids received relative to the notified amount) of 0.5."
Last week, Reserve Bank Governor Shaktikanta Das had announced plans to conduct the second round of TLTRO worth Rs 50,000 crore.
Earlier, the Reserve Bank had infused Rs 1 lakh crore through multiple tranches of TLTRO.
( With inputs from IANS )