In India, initially the RBI was announcing the yield curve to the market for year-end valuation. Currently, FIMMDA, a self-regulatory organisation, announces the yield curve, the methodology of which was approved by the RBI. Incidentally, although the statutory liquidity ratio (SLR) for the banking system is 25 per cent, banks are voluntarily holding 37 per cent of their liabilities in Government Securities.
Recognising the risks involved in such large exposures, the Reserve Bank of India (RBI) has created a path for banks to reach a targeted investment fluctuation reserve over a period.