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# India's RBI offers concessional forex swap and banking stocks rise
- URL: https://www.theglobalbanker.com/indias-rbi-offered-concessional-forex-swap-and-banking-stocks-rose/
- Published: 2026-06-09T10:09:13.000Z
- Updated: 2026-10-01T23:47:56.000Z
- Description: The Reserve Bank of India offered banks a concessional foreign exchange swap facility for overseas borrowings with a minimum maturity of three years, prompting a rise in banking stocks.
- Author: TGB Editorial Team
- Tags: Central Banks, Asia-Pacific

Banks in India saw their shares rise after the Reserve Bank of India offered a **concessional foreign exchange swap** facility for overseas borrowings that carried a minimum maturity of three years.

#### MECHANICS AND MARKET REACTION

Under the facility, banks raising overseas foreign currency borrowings can sell US dollars to the RBI and buy them back at the end of the swap at a fixed premium of 1.5 percent a year, compounded semi-annually, for tenors of up to five years. The facility, which is also open to government-owned public sector undertakings, applies to borrowings with a minimum maturity of three years drawn down up to 31 December 2026, and remains open until 15 January 2027\. Shares of Indian banks rose more than 1 percent on Tuesday, with the Nifty Bank index up 1.2 percent and the benchmark Nifty 50 up 0.5 percent. 

#### PRICING AND RELATED MEASURES

The 1.5 percent rate is roughly half the prevailing forward premium of 2.5-3 percent, according to Anindya Banerjee, head of research for currencies, commodities and interest rates at Kotak Securities, who said the discounted rate will encourage overseas borrowings by lowering costs.

Borrowings with embedded options and those raised for refinancing are excluded from the facility.

The RBI also opened a separate swap window for fresh FCNR(B) deposits mobilised between 8 June and 30 September 2026, and exempted those deposits from CRR and SLR requirements.

**Sources:** [The Hindu Business Line Banking](https://www.thehindubusinessline.com/markets/banking-stocks-rise-on-forex-swap-facility-for-overseas-borrowings/article71079205.ece)