Bank of India is planning to raise up to $1 billion through a Medium-Term Note (MTN) programme to attract more foreign currency deposits. This move follows a successful early response to its FCNR-B offerings. On August 10, 2026, the bank's shares dropped nearly 2.5% as the market reacted to the news of the capital raise.
Bank of India has formally announced plans to raise up to $1 billion through a Medium-Term Note (MTN) programme. This initiative is aimed at increasing the bank's Foreign Currency Non-Resident-Bank (FCNR-B) deposits by tapping into international markets. The bank’s Board of Directors is scheduled to meet on August 14, 2026, to discuss and approve the structure of this fundraising.
The core objective is to take advantage of a temporary concessional swap window provided by the Reserve Bank of India (RBI). This window allows banks to convert foreign currency inflows into rupees at a special, lower-cost rate, making it easier for them to offer competitive interest rates to Non-Resident Indian (NRI) depositors. The bank has already seen positive momentum in this space, having mobilized $207.46 million in FCNR-B deposits between June 5 and July 30, 2026.
The proposed fundraising will be executed through the bank's branch at GIFT City in Gujarat. The plan involves issuing USD-denominated bonds with tenors of three to five years. The bank intends to complete this fundraising in multiple parts, with the issuance timeline stretching until December 31, 2026. Following the announcement of this plan on August 10, 2026, shares of Bank of India closed lower by approximately 2.5% at ₹141.39 on the National Stock Exchange.
This decision follows earlier capital-raising efforts by the bank. In December 2025, Bank of India raised ₹2,500 crore through Tier II bonds and ₹10,000 crore via long-term infrastructure bonds. These regular capital-raising exercises are part of the bank's strategy to strengthen its balance sheet and manage its long-term funding requirements.
Investors should monitor the specific timing and execution of this $1 billion raise, as the RBI's concessional swap window is currently set to expire on October 16, 2026. Because the bank relies on this temporary window to offer attractive rates, the sustainability of deposit growth may depend on the bank's ability to successfully secure the funding before the facility closes. Additionally, the bank will need to manage potential risks related to foreign currency fluctuations as it works toward this $1 billion target in a competitive global market.