Banks left no stones unturned to earn arbitrage from their investments either in money markets or in mutual funds. This is because banks this time have found 50-60 basis point (bps) higher arbitrage opportunity from investments in liquid funds than in the Reserve Bank of India’s (RBI) Standing Deposit Facility (SDF), leading to the money being put into mutual funds rising by more than 90 percent in March over a year, fund managers and treasury heads have said.
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