RBI prematurely closes FCNR(B) swap window as forex inflows cross $56.8 billion

The Reserve Financial institution of India (RBI) has shortened the window for mobilising FCNR(B) deposits below its particular USD-INR foreign exchange swap facility to August 31, citing the encouraging response and robust foreign exchange inflows generated via the scheme.

Underneath the revised timeline, FCNR(B) deposits mobilised till August 31, 2026, might be swapped with the RBI till September 11, 2026.

The central financial institution had earlier stated the power would stay open till October 16 for FCNR(B) deposits mobilised between the date of the round and September 30.

The RBI launched the particular USD-INR foreign exchange swap facility on June 8, overlaying FCNR(B) deposits, Exterior Industrial Borrowings (ECBs) and Abroad Overseas Forex Borrowings (OFCBs).

The ability has attracted whole foreign exchange inflows of $56.85 billion as of August 13, in response to information reported by authorised supplier banks.

Of this, FCNR(B) deposits accounted for $52.3 billion, whereas OFCBs contributed $2.81 billion and ECBs $1.74 billion.

Whereas the mobilisation window for FCNR(B) deposits has been introduced ahead, the swap facility for ECBs and OFCBs will proceed to stay open till December 31, 2026, in response to the RBI’s revised timeline.

ECB, OFCB swap window stays open until December 31

Whereas the RBI has introduced ahead the deadline for concessional swaps below the FCNR(B) scheme, the window for concessional swaps via abroad international forex bonds (OFCBs) and exterior industrial borrowings (ECBs) stays open till December 31, 2026.

RBI information exhibits that banks have raised $4.546 billion via the latter two routes thus far.

On Friday, Bank of Baroda grew to become the most recent financial institution to boost dollar-denominated bonds via the power, mobilising $700 million in two tranches with three-year and five-year tenors.

Previous to Financial institution of Baroda, 5 banks —State Bank of India, HDFC Bank, ICICI Bank, Axis Bank and Canara Bank — had cumulatively raised $3.55 billion via dollar-denominated bonds. The quantity may rise to as a lot as $15 billion by the point the window closes on December 31, 2026.

Sources advised CNBC-TV18 that HDFC Financial institution, which raised $750 million via dollar-denominated bonds in June, could also be seeking to elevate extra funds via this route.

RBL Financial institution can also be among the many different banks seeking to elevate funds via the route, sources added.