UPDATE 1-India o/n rates steady; volume down after holidays

(Updates to close)

MUMBAI, Nov 3 (Reuters) - Indian call money ended little changed on Tuesday as surplus cash in the system continued to help, and on low volumes as most banks had already made arrangements for their fortnightly reserve needs, traders said.

The one-day inter-bank money INROND= closed at 3.20/30 percent, barely moved from Friday's close of 3.25/30. It had ended flat in an illiquid market on Saturday.

The market was shut on Monday for a local holiday.

"Many banks have covered for their CRR (cash reserve ratio) requirements before the holidays, and that could be one reason for less activity," said Srinivasa Raghavan, treasury head at IDBI Gilts.

Banks are mandated to report their liabilities to the central bank on a bi-weekly basis and park 5 percent of their deposits with it as cash.

Traders said a hike in SLR by the RBI last week would mean banks allocating more cash for buying bonds, cutting liquidity level in the banking system in the coming weeks. The new SLR would be effective from Nov. 7.

The Reserve Bank of India raised the statutory liquidity ratio (SLR) by 100 basis points to 25 percent at its monetary review last Tuesday, unwinding a cut made last November during the credit crisis. The [ID:nDEL485971]

Banks parked 1.24 trillion rupees with the central bank at its reverse repo auction on Tuesday, showing the extent of cash surplus in the system.

The weighted average rate in the call money market was 3.25 percent, while in collateralised borrowing and lending obligation (CBLO), it was 2.71 percent, according to the Clearing Corp of India (CCIL).

Volume in the call money market was 52.41 billion rupees, below 81.60 billion rupees on Friday. In CBLO, it was 671.03 billion rupees, CCIL data showed. (Reporting by Boby Michael; Editing by Prem Udayabhanu)