REITs may invest in debt securities issued by InvITs, REITS: RBI circular

Reserve Bank said on Tuesday that REITs were allowed to invest in debt securities issued by infrastructure investment trusts (InvITs) and real estate investment trusts (REITs) by foreign portfolio investors (REITs). .

The necessary changes to the Foreign Exchange Management (Debt Instruments) Regulations 2019 were notified earlier in October.

An announcement was made in the Union Budget 2021-2022 that debt financing of InvITs and REITs by Foreign Portfolio Investors (REITs) will be activated by making the appropriate changes to relevant legislation.

As a result, it was decided to allow REITs to invest in debt securities issued by InvITs and REITs, the RBI said in a circular.

“REITs can acquire debt securities issued by InvITs and REITs under the Medium Term Framework (MTF) or Voluntary Retention Track (VRR),” he said.

These investments will be accounted for within the limits and will be subject to the terms and conditions of the REIT’s investments in debt securities under the respective regulations of MTF and VRR.

(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)

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John A. Bogar