Indian Bank’s FCNR deposit target more than quadruples last year’s $457 million haul

Indian Bank’s target of raising $2 billion through foreign currency non-resident, or FCNR(B), deposits this year is more than four times what the public sector lender mobilised through the scheme in all of FY26, when it raised $457 million.

The sharp jump follows the Reserve Bank of India’s decision to withdraw the interest rate ceiling on fresh FCNR(B) deposits with maturities of three to five years, a relaxation in place until September 30, 2026. Indian Bank MD and CEO Binod Kumar said in Chennai on Friday that the bank has already seen a spurt in inflows over the past 25 days, securing $140 million between June 15 and July 9 alone, with a pipeline of $1 billion already in place toward the $2 billion goal by September.

Kumar said the proposed $2 billion mobilisation would be among the highest the bank has achieved under the FCNR(B) scheme. To draw in the deposits, Indian Bank has raised its interest rate on FCNR(B) deposits to 6% from 5.5%, with the annualised return for depositors working out to around 13%-14%.

The deposit drive comes as Indian Bank reported a 10% rise in net profit to Rs 3,273 crore for the first quarter, up from Rs 2,973 crore in the year-ago period, driven by an increase in yield on advances and strong growth in net interest income.

The FCNR(B) scheme allows non-resident Indians to hold fixed deposits in foreign currency with Indian banks, and the RBI’s temporary relaxation of the rate ceiling is aimed at drawing in stronger capital inflows during the window through September 2026.