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      Question

      Following a recommendation by the National Financial

      Reporting Authority, which investor group was directed by SEBI in August 2024 to value their AT-1 bond investments based on Yield-to-Call (YTC)?Β 
      A Portfolio Management Services (PMS) Correct Answer Incorrect Answer
      B Mutual Funds (MFs) Correct Answer Incorrect Answer
      C Foreign Portfolio Investors (FPIs) Correct Answer Incorrect Answer
      D Alternative Investment Funds (AIFs) Correct Answer Incorrect Answer
      E Social Stock Exchange (SSE) Correct Answer Incorrect Answer

      Solution

      SEBI's directive to Mutual Funds to use the YTC valuation method for AT-1 bonds seeks to standardize investment practices in line with Ind AS 113 principles. This method calculates expected returns if the bond is held until its call date, enhancing transparency and uniformity in bond valuation.

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