Current Affairs · Banking and Finance
What historically restricted the widespread adoption of the Partial Credit Enhancement (PCE) facility introduced for corporate infrastructure bonds in India?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Mandatory conversion clauses turning corporate bonds into equity shares within one year.
- 2A statutory prohibition preventing insurance companies from purchasing enhanced bonds.
- 3Extremely high underwriting fees levied by clearing corporations.
- 4The restrictive regulatory cap on total credit enhancement, which limited its utility for lower-rated issuers trying to achieve institutional grade.✓
Correct answer
The restrictive regulatory cap on total credit enhancement, which limited its utility for lower-rated issuers trying to achieve institutional grade.
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