FINANCIAL MANAGEMENT

(LIVE PROJECT)
FINAL PRESENTATION
TOPIC - DISCOUNT & FINANCE HOUSE OF INDIA

SUBMITTED TO, SUBMITTED BY

PROF. NAVNEET ATULIT GARG
SAXENA 19BSP0569
SECTION - I
 INTRODUCTION
The discount and finance house of India was setup in April 1988 by
the Reserve bank of India to help develop the money market in
India. Money market refers to an activity in which financial
transactions in short term financial assets which are close
substitutes for money.

With a view to impact increased liquidity in the market instruments

the DFHI was setup. It would deal with treasury bills of different
maturities and rediscount short term commercial bills. DFHI
participates both lender and borrowers in the money market since
1988.
 OBJECTIVES
 It should be the sole depository of the surplus liquid of the
banking system.
 It should be used surplus funds to even out the imbalances in
liquidity in the banking systems.
 Create ready market for commercial bills, treasury bills and
government securities.
 Provide safe and risk free short term investments avenues.
 RESOURCES OF DFHI
LTD.
1. The paid up capital of Rs. 200 crores contributed jointly by the
RBI, Public Sector Banks and all India Financial Institution in the
proportion 5:3:2.
2. The authorized capital of the company is Rs. 250 crores.
3. Refinance facility of different types from the RBI against the
collateral of instruments it deals in.
4. Line of credit from banks on a consortium basis of Rs. 100 crore
from 28 Public Sector Banks.
 DFHI IS ACTIVE IN
1. The inter bank call money market
2. The 181 days treasury bills, and
3. The bill discounting etc
 MONEY MARKET
INSTRUMENTS DFHI
DEALS
 Treasury Bills
 Dated government securities
 Certificate of deposits
 Commercial papers
 Call money
 Notice money
 Interest rate swaps
 S.B.I DFHI
S.B.I DFHI is a primary setup an institution created by the RBI to
support the book building process in primary auctions of
government securities and provide necessary depth and liquidity to
the secondary market in government securities.

It is an amalgamation in 2004 of the two leading players in the

domestic money and debt market the RBI promoted DFHI and SBI
gilts ltd a subsidiary lender in the primary dealer segment of the
domestic debt market with a net worth of 965.39 crore and a
presence in all major financial centers of the country.
 S.B.I DFHI CONTD.
 Posted an impressive turnover total turnover of Rs. 568327 crore
in government securities.
 Posted a turnover of RS. 67066 crore in treasury bills in the
financial year 2018-19.
 As primary dealers they trade in Treasury bills, Government
securities, State development loans, Non SLR bonds, Corporate
bonds etc.
 And lastly they all are active in relating government securities
including small lots.
Financial values in the chart are available after SBI DFHI Ltd report is purchased.
 S.B.I DFHI OFFERS
 SBI DFHI Invest: SBI DFHI invests in Government securities,
State dev. Loans, Treasury bills etc.
 SBI DFHI INVEST PLUS: Bank CD’s Corporation commercial
papers, Corporate bonds etc.
 SBI DFHI MONEY: Inter corporate deposits.
 SBI DFHI TRADE: High yield government securities.
 WHO DEAL WITH S.B.I
DFHI
 Individuals
 Corporates
 Regional Rural Banks
 Cooperative Banks
 Trusts
 Insurance Companies
 Mutual Funds
 DISCOUNT HOUSES IN
LONDON (U.K)
The London discount market is about 175 years old and it consists
of about a dozen discount houses and about as many others firms
which under take similar work. The discount houses some of which
have subsidiaries are the expert financial intermediaries which
perform various specialized functions or tasks that soother financial
institution will do.
Their main business activities has changed over the years i.e the
instruments or security which formed the major part of their otal
assets has varies in different periods depending on which
instruments to be happened.
 DISCOUNT HOUSES IN
LONDON (U.K) CONTD.
 Operate both in primary and secondary market for financial
instruments on the whole day.
 Deal in inland bills, foreign bills of exchange, treasury bills, gilt
edged securities of maturities less than 5 years, negotiable
securities of deposit etc.
 Lend to both public and private sectors.
 It have a unique place in the functioning of the British monetary
system in the sense that they had a special privileged position.
 CONSTITUENT SGL
ACCOUNT
DFHI has opened a constituent SGL account with the RBI .
According to the procedure laid down by RBI customer of DFHI can
open a constituent SGL account with DFHI. Their holdings in T-bills
are dated securities are transacted through account.

When a purchase is made from DFHI the corresponding security

will be transferred from DFHI normal account to the constituent
account. A certificate of holding will be issued by the RBI for the
records of the investor. As and when maturity proceeds and interest
if any are received the same will be passed to the constituent.
 CONSTITUENT SGL
ACCOUNT CONTD.
In case the constituent desires to dis invest the same can be done
and DFHI will be transfer the security from its constituent account
on receipt of authorization from the holder.
 CONCLUSION
With own reference and support from RBI in refinance facility and
broad based money instruments, DFHI is poised for continued
sustained growth and more effective role to fulfill the basic objective
of the money market i.e facilitate smoothening of short term
liquidity.
THANK YOU