BPD.PCB. Cir. 1 / 09.11.00/ 2003-04

July 8, 2003

The Chief Executive Officers
All Primary (Urban ) Co-operative Banks

Dear Sir / Madam,

Settlement in respect of Government Securities Transactions-
Compulsory settlement through Clearing Corporation of India Ltd.

As you are aware the Reserve Bank of India has extended to all market participants the facility of settlement in Government Securities transactions over NDS - CCIL System besides the settlement under Delivery vs. Payment system. With effect from 1st April, 2003, all Government Securities transactions ( both outright and Repo ) are being settled compulsorily through Clearing Corporation of India Ltd. ( CCIL) only. Any transactions in Govt. securities for settlement by the banks outside the NDS-CCIL system are not being entertained by Reserve Bank of India since that date.

2. Primary (urban) co-operative banks which are not a member of NDS - CCIL system, should undertake their transactions in Government securities through gilt account / demat account maintained with Negotiated Dealing System ( NDS) member, approved for the purpose vide para 2(i) of our circular UBD. No. BR. 47 / 16.26.00/ 2001-02 dated June 7, 2002.

Yours faithfully,

( Sudarshan Sen)
General Manager