Types of Bids in Auction

Investors have the option to place either competitive bids or non-competitive bids in the auction.

Competitive vs Non-competitive bids

Competitive bids include the price as well as the amount that they want to purchase. However, investors (other than banks/investment banks/DFIs) can also place “non-competitive bids”. The quantum size of non-competitive bids for one investor is linked with auction target. The non-competitive bids can be submitted through PDs or non PDs to SBP as per details given with auction announcement. The bids of any investor can be rejected if the investor submits more than one bid for a single tenor. These bids are accepted at weighted average yield in each tenor as decided in the primary auction. In case of over subscription, non-competitive bids are accepted in order of lowest to highest amount or on pro-rata basis.