09 Jun , 2026 By : Debdeep Gupta
Bank Nifty rose more than 1 percent on Tuesday, with all 14 constituents of the banking index trading in the green, after the Reserve Bank of India unveiled details of a concessional forex swap facility. The concessions are aimed at encouraging overseas fund raising by banks and public sector enterprises.
The banking pack led gains on Dalal Street, helping benchmark indices recover after two days of losses. At 09:55 am, the Nifty Bank index was up 1.28 percent at 54,758. The Nifty Private Bank index gained 1.31 percent, while the Nifty PSU Bank index rose 1.04 percent.
Among the top gainers on the Nifty 50 were ICICI Bank, up 1.5 percent, and Axis Bank, which gained 1.3 percent. Kotak Mahindra Bank also advanced over 1 percent. Other banking stocks saw broad-based buying, with Yes Bank, Federal Bank and Bank of Baroda rising around 1.7 percent each, while Canara Bank and Punjab National Bank gained over 1 percent. State Bank of India was up 0.7 percent.
The rally followed RBI's operational guidelines for its FCNR(B) deposit and external commercial borrowing (ECB) schemes announced after market hours on Monday. Under the facility, authorised dealer banks can access a concessional swap window for fresh and renewed FCNR(B) deposits with maturities of three to five years until September 30. The central bank will also provide a swap facility for eligible overseas borrowings.
Brokerage Jefferies said the terms are supportive for lenders and could attract substantial foreign capital inflows. It added that banks would not bear hedging costs on FCNR(B) deposits under the scheme, compared with hedging costs of around 3.5 percent during a similar programme in 2013. FCNR(B) deposits will also be exempt from cash reserve ratio (CRR) and statutory liquidity ratio (SLR) requirements.
For ECBs, Jefferies said banks and public sector enterprises can raise overseas funds while benefiting from a concessional RBI swap facility that effectively lowers hedging costs. The brokerage estimates total inflows from the measures could reach $50-70 billion, compared with about $34 billion during the 2013 programme.
The strength in banking shares also helped broader markets. The Sensex was up 285 points at 73,809, while the Nifty gained 88 points to trade above 23,200. Market breadth was firmly positive, with advancing shares outnumbering declines by more than three to one.
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