Lingering uncertainty over the valuation of perpetual bonds could hit fundraising at public-sector lenders such as Punjab National Bank, Bank of India and Bank of Maharashtra, which plan to garner funds by selling debt instruments. While the Centre has ‘requested’ the capital-markets watchdog to review its order on the treatment of such debt, regulatory silence is making investors nervous and causing yields to harden.

“An amicable resolution should be found without any further disruptions,” said Mahendra Jajoo, chief investment officer – fixed income, Mirae Asset Investment Managers.

Nervousness is still there, but the panic is gone,” he said.

There were nine secondary market trades in the bonds of National Bank of Agriculture and Rural Development (NABARD).bonds are due for maturity in 2024. While a particular series yielded as high as 5.75%, the average for all deals was 5.67% Friday.

Under normal circumstances, yields should be around 5.50%, dealers said.

Four secondary market transactions took place for National Housing Bank bonds, maturing early 2024, at an average yield of 5.45 percent, about 10 basis points higher than usual.

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