KOLKATA: Reserve Bank of India (RBI)
said that the concessional swap facility will not be extended beyond November
30, putting all speculation to rest, but allowed some breathing space for banks
currently busy with negotiating with global lenders for taking overseas loans.
The central bank said it will allow banks to get the benefit if they get firm commitment from global financial institutions on or before November 30, 2013.
The central bank said it will allow banks to get the benefit if they get firm commitment from global financial institutions on or before November 30, 2013.
KOLKATA: Reserve Bank of India (RBI)
said that the concessional swap facility will not be extended beyond November
30, putting all speculation to rest, but allowed some breathing space for banks
currently busy with negotiating with global lenders for taking overseas loans.
The central bank said it will allow banks to get the benefit if they get firm commitment from global financial institutions on or before November 30, 2013.
The central bank said it will allow banks to get the benefit if they get firm commitment from global financial institutions on or before November 30, 2013.
RBI had in September allowed banks
to borrow up to 100% of their Tier-I capital from overseas markets and swap
dollar with it for rupees. The measure was aimed at attracting dollar inflows
and arrest the rupee's depreciation. It offered one percentage point lower swap
rate than the market rate till November 30.
However, if the bank is not in a position to deliver the contracted amount of foreign currency on the contracted date, it will have to pay the difference between the concessional swap rate contracted and the market swap rate plus one hundred basis points.
The other terms and conditions for the swap will remain unchanged as notified earlier.
However, if the bank is not in a position to deliver the contracted amount of foreign currency on the contracted date, it will have to pay the difference between the concessional swap rate contracted and the market swap rate plus one hundred basis points.
The other terms and conditions for the swap will remain unchanged as notified earlier.
Shah Mohammad Abdul Qadir
PGDM 1st Semester
IIMT College Of Management
Greater Noida, U.P.
RBI had in September allowed banks
to borrow up to 100% of their Tier-I capital from overseas markets and swap
dollar with it for rupees. The measure was aimed at attracting dollar inflows
and arrest the rupee's depreciation. It offered one percentage point lower swap
rate than the market rate till November 30.
However, if the bank is not in a position to deliver the contracted amount of foreign currency on the contracted date, it will have to pay the difference between the concessional swap rate contracted and the market swap rate plus one hundred basis points.
The other terms and conditions for the swap will remain unchanged as notified earlier.
However, if the bank is not in a position to deliver the contracted amount of foreign currency on the contracted date, it will have to pay the difference between the concessional swap rate contracted and the market swap rate plus one hundred basis points.
The other terms and conditions for the swap will remain unchanged as notified earlier.
Shah Mohammad Abdul Qadir
PGDM 1st Semester
IIMT College Of Management
Greater Noida, U.P.
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