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SGB Term

RBI (Reserve Bank of India)

India's central bank that issues Sovereign Gold Bonds on behalf of the government

Quick Definition

India's central bank that issues Sovereign Gold Bonds on behalf of the government

Complete Explanation

The Reserve Bank of India (RBI) is India's central banking institution that issues Sovereign Gold Bonds on behalf of the Government of India.

RBI's role in SGB: - Issues new SGB series (primary issuance) - Sets issue price based on gold price - Manages redemption at maturity - Handles premature redemption (after 5 years) - Pays interest to bondholders - Maintains bond ledger accounts

SGB issuance schedule: - RBI announces tranches throughout the year - Subscription period typically 5 working days - Allotment date specified in announcement - Issue price = Average of last 3 days' gold price

RBI backing makes SGBs one of the safest gold investments - sovereign guarantee means zero default risk.

Examples

  • 1RBI announces SGB 2024-25 Series I in April 2024
  • 2Issue price set by RBI based on IBJA gold price
  • 3Maturity redemption handled by RBI automatically

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