India's leading private-sector banks, including HDFC Bank, Axis Bank, and Kotak Mahindra Bank, reported robust deposit growth in the July-September quarter (Q2FY27), significantly aided by the Reserve Bank of India's concessional FCNR(B) swap window.
Indian banks are projected to achieve healthy profit growth in the second quarter of financial year 2027 (Q2FY27), driven by lower credit costs, robust advance growth, and fee income. However, net interest margins (NIMs) are expected to face pressure due to significant mobilisation of foreign currency non-resident (bank) FCNR(B) deposits.
HSBC has emerged as the leading international bank in facilitating fundraising for Indian companies through bonds, syndicated loans, and IPOs during January-September 2026, according to Hitendra Dave, CEO of HSBC India.
The Reserve Bank of India's recent measures, including a dedicated dollar window for state-run oil marketing companies and tightened foreign exchange derivative rules, are expected to provide near-term relief to the rupee's depreciation, but market participants believe global factors and balance of payment dynamics will continue to exert pressure in the medium term.
Anup Bagchi, the incoming MD & CEO of HDFC Bank, is set to become India's highest-paid bank CEO with a proposed target annual compensation package of approximately 35.9 crore, including a significant variable pay component and a one-time joining bonus.
Reserve Bank of India (RBI) Governor Sanjay Malhotra stated that surplus liquidity in the banking system is expected to drain within the current financial year, utilising tools like currency leakage, sell-buy swaps, open market operations (OMOs), and variable rate operations.
'We see a lot of cases of bank deposits getting lost, especially when people die, so this will help address that because you have one consolidated view.'
'In fact, when monetary policy has been deployed, it does not distinguish between types of shocks. It goes straight for the kill.'
'Get people young, train them, assimilate them, and grow them adequately.'
Anup Saha, currently a Wholetime Director at Kotak Mahindra Bank, has been appointed as the new Managing Director and Chief Executive Officer for a three-year term, effective January 1, 2027, with the Reserve Bank of India's approval.
The Reserve Bank of India's outstanding net short dollar position in the forward book surged to a record $200.06 billion at August-end, up from $136.77 billion at July-end, primarily driven by FCNR(B) flows.
After a significant 9.9% depreciation in FY26, the Indian rupee has shown comparative stability in the first half of FY27, depreciating by only 1.1%, attributed to regulatory interventions and measures to attract foreign capital, despite ongoing global pressures from rising crude oil prices and foreign investor outflows.
Reliance Industries Ltd (RIL) has successfully raised a total of Rs 25,000 crore through domestic bond issues in September, including a recent Rs 13,000 crore 10-year bond at 7.90 per cent, as it prioritises funding certainty amidst expectations of a possible RBI rate hike and rising borrowing costs.
The Reserve Bank of India (RBI) net purchased a record $18.65 billion in July, driven by inflows from its concessional swap facility, leading to a significant increase in India's foreign exchange reserves.
75% of India's 60 million digital-payment merchants have never recorded a transaction above 2,000.
RBI Deputy Governor Rohit Jain highlighted that banks are well-positioned to deploy $133 billion mobilised through FCNR(B) deposits, especially with strong credit demand ahead of the festival season, while also stressing the importance of robust technology governance and cyber defences in the financial sector.
India's Chief Economic Advisor V Anantha Nageswaran stated that the country's balance of payments (BoP) pressure is expected to remain a continuous challenge due to rising imports, commodity dependence, high global interest rates, and intense competition for capital.
State Bank of India (SBI) anticipates that the newly introduced Merchant Discount Rate (MDR) on person-to-merchant (P2M) UPI transactions above 2,000, effective October 15, will enable it to recover the costs incurred in processing and facilitating these transactions, potentially even generating a small surplus.
'There will be some inconvenience to people. But we have given one-month notice to the government one month ago.'
India's deposit growth has reached a 15-year high of 17.8 per cent, primarily driven by a surge in foreign currency non-resident (bank), or FCNR(B), deposits. This influx of funds is expected to lead to a softening of corporate loan rates as banks seek to deploy their excess liquidity.
