Of the total inflows, Foreign Currency Non-Resident (Bank) [FCNR(B)] deposits accounted for $65.40 billion, while Overseas Foreign Currency Borrowings (OFCBs) brought in $4.86 billion and External Commercial Borrowings (ECBs) contributed $2.59 billion.
The Reserve Bank introduced the special USD-INR forex swap facility covering FCNR(B) deposits, ECBs and OFCB inflows on June 8, 2026. The scheme is open until August 31, 2026 for FCNR(B) deposits, while the facility for ECBs and OFCBs remains open until December 31, 2026, as announced by the RBI in its August 14 press release.
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Several Indian banks have moved to raise overseas dollar funding amid the Reserve Bank of India’s special forex swap facility. Yesterday, India’s largest private sector lender HDFC Bank had raised $1.75 billion through a dollar bond issuance, marking its largest overseas fundraise since the Global Financial Crisis in 2008.
HDFC Bank said on August 20 that the issuance was carried out through its GIFT City branch and comprised two tranches — $500 million of three-year bonds and $1.25 billion of five-year bonds.
The three-year notes carry a coupon of 5.159%, while the five-year notes offer a coupon of 5.401%, with interest payable semi-annually. Both tranches are scheduled to settle on August 26. The three-year bonds will mature on August 26, 2029, while the five-year bonds will mature on August 26, 2031.
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The three-year bonds were issued at a spread of 88 basis points over US Treasuries, while the five-year bonds were issued at a spread of 100 basis points over Treasuries.
The bonds will be listed on India INX and the National Stock Exchange (NSE). Moody’s has assigned a Baa3 rating to the bonds, while S&P Global Ratings has rated them BBB.The lender raised the funds through the 144A route, a private placement mechanism that allows issuers to sell securities to qualified institutional buyers in the US. The bonds are senior unsecured obligations of HDFC Bank.
The issuance comes as Indian banks step up overseas fundraising, with several lenders tapping the dollar bond market amid a favourable borrowing window and the Reserve Bank of India’s (RBI) concessional swap facility for external commercial borrowings (ECBs), which is available until the end of the year.
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Recently, IDFC First Bank raised $500 million through overseas bonds, while Kotak Mahindra Bank raised around $650 million in its debut five-year dollar bond issuance. ICICI Bank and State Bank of India (SBI) have also raised significant amounts through overseas debt markets.
The RBI has offered banks and state-run companies a concessional foreign exchange swap facility at a fixed annual rate of 1.5%, for an average maturity of at least three years. The facility, which is available until December 31, offers a lower funding cost than prevailing market rates and has encouraged lenders to tap overseas markets for dollar funding.
