RBI to conduct TLTRO worth Rs 25k crore on Friday

In a statement on Wednesday, the apex bank said: "So far, TLTROs for Rs 75,000 crore have been conducted in three tranches. It has now been decided to conduct the next TLTRO operation for Rs 25,000 crore.

"The funds availed under this tranche of TLTRO would have to be deployed within 30 working days from the date of the operation. The maximum amount that a particular bank can invest in the securities issued by a particular enti ty or group of entities out of the allotment received by it under the TLTRO shall be capped at 10 per cent."

Earlier, the Reserve Bank Governor Shaktikanta Das had said that a fresh  TLTRO will be conducted via which Rs 1 lakh crore would be injected through multiple tranches.

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.