Yes Bank mobilises $2 billion via FCNR(B) deposits under RBI swap window |

Private sector lender Yes Bank has mobilised around $2 billion through FCNR(B) deposits under the Reserve Bank of India’s (RBI’s) concessional forex swap window, with most of the funds raised in the three-year and five-year maturity buckets, according to a source aware of the development.

The bank is likely to use the funds to replace high-cost deposits and support incremental lending, the source said.

Yes Bank’s mobilisation is lower than the $3-3.5 billion raised by some of its peers. However, the bank did not want to be “overly active” in raising foreign currency deposits and instead mobilised an amount that it could deploy comfortably, the source said.

The RBI on Monday said inflows through its concessional forex swap window, operationalised on June 8, had crossed $143.5 billion as of September 18, including FCNR(B) deposits, overseas foreign currency borrowings (OFCBs) and external commercial borrowings (ECBs).

FCNR(B) deposits accounted for nearly $133 billion of the total mobilisation. OFCBs and ECBs stood at $5.32 billion and $5.3 billion, respectively, as of September 18.

The FCNR(B) mobilisation figure relates to deposits mobilised up to August 31, when the window for fresh FCNR(B) deposits closed. The RBI had earlier said on September 2 that banks had mobilised a little over $127 billion through FCNR(B) deposits under the scheme by August 31.

The final mobilisation figure increased subsequently as banks were allowed to avail of the swap facility with the RBI until September 11 for FCNR(B) deposits mobilised up to August 31.

The RBI had operationalised the concessional forex swap window to attract foreign currency inflows into the banking system and had initially kept the FCNR(B) window open until September 30. However, it closed the window a month earlier following a strong response from banks.

The mobilisation through FCNR(B) deposits was significantly higher than market estimates of $90-100 billion. While the concessional swap window for FCNR(B) deposits closed on August 31, the facility for OFCBs and ECBs remains open until December 31.