Bank of Baroda doubles FCNR fundraising target with $8 billion mobilisation

Bank of Baroda has exceeded expectations in its foreign currency fundraising drive, mobilising $8 billion through the RBI's concessional swap window against an initial target of $4-5 billion. The oversubscription underscores robust market demand for FCNR(B) deposits, which offer non-resident Indians and overseas investors favourable terms for depositing foreign currency with Indian banks.

The RBI's swap facility, designed to ease forex liquidity pressures and support banks' deposit mobilisation efforts, has proven instrumental in Bank of Baroda's capital-raising strategy. The scheme allows banks to swap dollar deposits received under the FCNR(B) framework with the central bank, providing them greater flexibility in managing foreign exchange exposure.

The successful fundraising comes as Indian banks continue to navigate fluctuating global interest rates and forex volatility. Bank of Baroda's ability to nearly double its initial target reflects investor confidence in the lender and growing appetite for rupee-denominated alternatives among non-residents seeking rupee exposure.

The mobilised funds are expected to bolster the bank's forex reserves and support its lending operations, particularly for overseas corporate and trade finance requirements. The strong response also signals sustained interest from the non-resident community in parking funds with Indian banks at competitive rates.