Private banks top FCNR(B) deposit drive; ICICI leads, HSBC tops overall, SBI No. 1 among PSBs

ICICI Bank, Kotak Mahindra Bank, Axis Bank and HDFC Bank each mobilised over $1 billion, whereas HSBC topped the list as the biggest mobiliser with $6.14 billion.
| Photo Credit:
LEE JAE WON

Private sector banks (PVBs) surpassed public sector banks (PSBs) in gathering Foreign Currency Non‑Resident (FCNR(B)) deposits with 3‑ to 5‑year maturities under the RBI’s temporary US‑Dollar‑Rupee forex swap window, as shown in data presented to the Lok Sabha.

Foreign banks, spearheaded by HSBC and Standard Chartered Bank (SCB), together raised almost as much as the combined total of all 12 public sector banks during the June 5‑July 30 2026 window.

Out of the 20 private‑sector banks, four—ICICI Bank, Kotak Mahindra Bank (KMB), Axis Bank and HDFC Bank—each attracted over $1 billion via FCNR(B) deposits. By comparison, among the 12 public‑sector banks, only the State Bank of India (SBI) and Bank of Baroda (BoB) exceeded the $1 billion threshold.

Among the 42 banks that took part, HSBC, SBI and ICICI Bank led the pack, drawing $6.14 billion, $4.12 billion and $3.69 billion respectively from non‑resident Indians (NRIs) into FCNR(B) deposits.

Private‑sector banks together collected $10.73 billion, with six institutions driving most of the inflow: ICICI Bank ($3.69 billion), Kotak Mahindra Bank ($1.65 billion), Axis Bank ($1.58 billion), HDFC Bank ($1.40 billion), YES Bank ($810.39 million) and RBL Bank ($556.68 million).

Public‑sector banks amassed $8.84 billion, yet only five exceeded the $500 million mark: SBI ($4.12 billion), BoB ($1.04 billion), Punjab National Bank ($969.63 million), Canara Bank ($933.47 million) and Indian Bank ($835.87 million).

Of the 12 foreign banks involved, HSBC led with $6.14 billion, and Standard Chartered Bank (SCB) was the sole other participant to surpass the $1 billion level, raising $1.85 billion.

Industry analysts say the outperformance of certain private‑sector and foreign banks relative to most public‑sector banks stems from their capacity to provide greater leverage and higher net returns for depositors, where returns equal deposit interest minus the cost of that leverage.

Major private lenders including HDFC Bank and ICICI Bank have boosted their FCNR(B) fundraising by lifting deposit rates by 25 basis points, from 6 % to 6.25 %.

When answering questions about FCNR(B) deposits in the Lok Sabha, Minister of State for Finance Pankaj Chaudhary noted that the RBI’s US‑Dollar‑Rupee forex swap facility for new FCNR(B) deposits seeks to draw stable foreign‑currency inflows, bolster India’s balance of payments and relieve rupee pressure.

He added that the fresh FCNR(B) deposits gathered by banks will be exchanged with the RBI, increasing foreign‑exchange reserves and banking liquidity in the initial leg, with the transaction unwound at maturity.

Chaudhary further explained that the ultimate rise in foreign‑exchange reserves and banking liquidity hinges on the total foreign‑currency amount mobilised via the forex swap facility throughout the scheme’s duration.

Published on August 3, 2026