Indian Banks Reduce FCNR Deposit Rates Following Swap Window Closure
· Business · Economic Times, CNBC
Indian banks, including State Bank of India (SBI), HDFC Bank, and ICICI Bank, have significantly slashed interest rates on foreign currency non-resident (FCNR) deposits. The reductions, reaching up to 310 basis points, follow the Reserve Bank of India's (RBI) decision to close its special FCNR(B) swap window on Monday. Banks had previously offered elevated rates for ten weeks to attract overseas funds from the diaspora. HDFC Bank and ICICI Bank both cut their five-year dollar deposit rates by 310 basis points, while SBI implemented reductions of up to 295 basis points.
Why it matters
The rollback of high interest rates marks the end of a temporary liquidity boost for Indian banks. It reflects the normalization of funding conditions after a period of intense competition for dollar deposits.
Read the original report — Economic Times
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