RBI underwriting auction sets ACU cut-offs for two Government securities

The Reserve Bank of India (RBI) has released the results of an underwriting auction conducted on July 24, 2026, for Additional Competitive Underwriting (ACU) of two Government of India securities. The outcome sets the cut-off rates for underwriting commission payable to Primary Dealers (PDs), a routine but important step that helps ensure orderly execution of government borrowing through the market.

Underwriting auctions are designed to provide confidence that the government’s scheduled bond issuance will be fully subscribed. In this framework, PDs commit to underwrite a portion of the notified amount through a Minimum Underwriting Commitment (MUC), and can competitively bid for additional underwriting through ACU. The RBI then sets a cut-off commission rate for the additional portion, expressed in paise per ₹100.

Key results: full underwriting for both securities For the security titled **New GS 2041**, the notified amount was **₹17,000 crore**. The **MUC amount** was **₹8,505 crore**, while the **ACU amount accepted** was **₹8,495 crore**. This brought the **total amount underwritten** to the full **₹17,000 crore**.

For this security, the RBI set the **ACU commission cut-off rate at 0.74 paise per ₹100**.

For the security titled **7.43% GS 2076**, the notified amount was **₹11,000 crore**. The **MUC amount** was **₹5,502 crore**, and the **ACU amount accepted** was **₹5,498 crore**—again taking the **total amount underwritten** to the full **₹11,000 crore**.

For this security, the **ACU commission cut-off rate was set at 0.98 paise per ₹100**.

Taken together, the figures indicate that the underwriting framework functioned as intended, with the full notified amounts covered through the combination of MUC and competitively accepted additional underwriting.

How to read the cut-off commission numbers The ACU cut-off rates—**0.74** and **0.98 paise per ₹100**—represent the commission payable to PDs for the accepted additional underwriting commitments. In practical terms, these rates show the market-clearing commission levels at which the RBI accepted underwriting bids for the additional portion beyond the minimum commitments.

While the commission is a small number in absolute terms, it plays a useful role in ensuring participation and providing a transparent, competitive mechanism for allocating underwriting across market makers. This supports deeper liquidity and smoother price discovery in the government securities market.

Next step: sale of securities on July 24, 2026 The RBI also noted that the **auction for the sale of these securities will be held on July 24, 2026**. Underwriting, in this sequence, acts as a risk-mitigation and market-stabilising layer prior to the sale, helping ensure that the borrowing programme proceeds in a predictable and efficient manner.

By completing the underwriting process and publishing clear cut-offs, the central bank provides market participants with timely signals and operational clarity—an approach that supports confidence in India’s government securities issuance calendar.

**Why it matters:** A well-functioning underwriting process helps the government raise funds smoothly, strengthens market confidence, and supports the ongoing development of India’s bond market through transparency and competitive participation.