RBI to continue buyback of foreign convertible bonds

Mumbai: The Reserve Bank of India would continue to buy back foreign currency convertible bonds (FCCBs) issued by Indian companies under the approval route, it said on Thursday.

The RBI will consider proposals from Indian companies for buyback of FCCBs, if the buyback value is at a minimum discount of 5% on the accreted value, it said in a statement.

The buyback scheme would lapse after 31 March, the RBI said.

Indian companies face convertible bond redemptions of nearly $5.5 billion this year. A sharp economic and corporate growth slowdown, weakening of the rupee that hit record lows last month and a plunge in stock values have made the debt obligation very costly for some companies.