The Reserve Bank of India held a government securities underwriting auction on June 25, 2026. The RBI underwriting auction covered two securities under the Additional Competitive Underwriting (ACU) framework. Primary Dealers received commission rates based on cut-off bids submitted during the process.
Key Details of the RBI Underwriting Auction
The first security, the 6.68% GS 2040, carried a notified amount of ₹17,000 crore. The Minimum Underwriting Commitment (MUC) stood at ₹8,505 crore, while the ACU amount accepted was ₹8,495 crore. Therefore, the total amount underwritten reached the full ₹17,000 crore. The ACU commission cut-off rate for this bond was set at 0.30 paise per ₹100.
The second security, the 7.43% GS 2076, had a notified amount of ₹11,000 crore. Additionally, the MUC for this bond was ₹5,502 crore, with an ACU amount of ₹5,498 crore accepted. As a result, Primary Dealers underwrote the full ₹11,000 crore. However, the commission cut-off rate was higher at 0.78 paise per ₹100, reflecting stronger competitive bidding.
What This Means for Government Bond Markets
The RBI conducted the auction for the sale of these securities on the same day, June 25, 2026. Full underwriting of both bonds signals healthy participation from Primary Dealers. Meanwhile, the higher commission rate on the longer-dated 2076 bond reflects the added risk Primary Dealers associate with ultra-long-duration securities.
For example, bonds maturing in 2076 carry significant interest rate risk over decades. Therefore, dealers naturally demand a higher underwriting fee. This outcome suggests the government bond market remains functional and well-supported by key institutional players.
Additionally, complete coverage of both securities reduces rollover risk for the government’s borrowing programme. As a result, the RBI’s debt management objectives for this auction round appear fully met. Investors and market participants can view this as a stable signal for near-term gilt market sentiment.
Source: RBI Press Releases
