The additional tier-1 (AT-1) bond market, which has been witnessing subdued demand, is likely to see some activity with the possibility of the Insurance Regulatory Development Authority of India allowing insurers to invest in this category of bonds issued by banks.
The regulator is considering allowing insurers to buy hybrid AT-1 bonds issued by banks, senior official VR Iyer quoted.
AT-1 bonds do not have a fixed maturity date, and investors demand for a higher yield because of their perpetual nature and risk associated with the instrument.
