In the backdrop of the global developments, the Reserve Bank constituted a committee in 2013 chaired by Shri P. Vijaya Bhaskar, then Executive Director to recommend sturdy practices for financial benchmarks.
3 Just consider in this regard the enhanced capability to manage both pricing and liquidity risks. Price discovery in the credit derivatives market reduces the risk of mispricing loans. Moreover, securitisation, which is another credit risk transfer instrument, offers the possibility of managing more effectively the liquidity risk of traditionally illiquid loans in the balance sheet.