Foreign lenders, ICICI Bank gain the highest share in FCNR B mobilisation: Reports

India through Reserve Bank of Indias RBI through its special forex swap window to bolster foreignexchange liquidity mobilised inflows of USD 1364 billion and banks that leveraged their overseas balance sheet and offered the best interest rates captured the highest share according to news agency IANSThe inflows were not based on the bankrsquos domestic deposits as it far exceeded the normal deposit market footprint noted brokerage reports from Macquarie Jefferies Motilal Oswal Financial Services MOSL and BofA SecuritiesICICI Bankrsquos FCNR B mobilisationPrivate sector lender ICICI Bank was the standout performer among domestic banks The bank mobilised USD 1788 billion or around Rs 170 lakh crore in FCNRB deposits which roughly accounts 18 per cent share of the market according to MacquarieAs per Macquariersquos estimate more than 70 per cent of the mobilisation leverage came from the banks own balance sheet including nearly USD 9 billion in loans from its international branches and USD 36 billion in standby letters of credit issued to other banksWhereas MOSL pegged ICICI Banks share to a slightly lower 14 per cent but still twice its normal depositmarket footprint supported significantly by its international balance sheetRBL too gains significant inflowsSmaller banks such as private sector lender RBL Bank mobilised around USD 34 billion or approximately Rs 32000 crore accounting for about 27 per cent of total FCNRB deposits This was significantly higher than its normal deposit market share of around 05 per cent noted MOSLForeign banks the biggest gainersWhile domestic banks garnered significant inflows foreign banks were the biggest beneficiaries According to Jefferies its share of FCNRB deposits increased sharply from around 12 per cent in early June to between 15 per cent and 30 per cent of incremental flows by the end of JulyStandard Chartered also secured around 7 per cent of the incremental flowsHSBC was among the biggest recipients with MOSL estimating that the bank had captured around 22 per cent of total inflows mobilising USD 61 billion or roughly Rs 58000 crore as of July 30 However Jefferies bankwise data pointed out that HSBCs incremental deposits touched USD 614 billion by the end of AugustForeign reserves hit record highUnder the RBIs special swap window Indias foreign currency assets expanded by USD 479 billion taking total foreign exchange reserves to a record USD 7293 billionThe RBI mobilised a record USD 12723 billion through Foreign Currency NonResident Bank or FCNRB deposits as of August 31Including overseas foreigncurrency borrowings OFCB worth USD 53 billion and external commercial borrowings ECB of USD 39 billion the total inflows under the measures reached USD 136377 billionWhy did RBI launch FCNR swap windowThe Reserve Bank of India had launched the concessional FCNR swap window on June as part of broader steps to encourage capital inflows to boost Indias balance of payments during global uncertainty Under this facility banks can mobilise new FCNRB deposits and exchange the dollars with the RBI at a lower concessional rateSeveral banks raised rates on 35 year FCNRB deposits from around 24 per cent to 67 per cent making the deposits more attractive to NRIs as per IANSThe facility that was implemented on June 8 2026 and is available up to September 30 2026 for the FCNR B deposits and up to December 31 2026 for the Overseas Foreign Currency Borrowings and External Commercial BorrowingsThe government and RBI announced these measures to boost inflows as the West Asia crisis created significant challenges for the Indian economy The rising oil prices and foreign portfolio investor outflows led to concerns over external stability given India is the third largest consumer and importer of crude oilWith inputs from IANS