RBI Sets Up Currency Swaps For Banks Needing Dollar Funding

The Reserve Bank of India (RBI) last week said it will provide foreign exchange liquidity to foreign branches and subsidiaries of Indian banks through currency swaps.The Indian central bank said that such a measure would ease pressure on Indian banks managing short term fund requirements for their overseas business’s that have been squeezed by the global credit crisis.

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SBI Cuts Prime Lending Rate

State Bank of India (SBI) India’s largest bank has decided to reduce its prime lending rate by 75 basis points. The cut in interest rate is effective today, and was hammered out last week when the Chairmen of India’s 28 largest state owned lenders met with the Finance Minister P Chidamabaram. State owned commercial banks, account for around 96 per cent of the domestic credit market, and have agreed to cut benchmark prime lending rates in an effort to spur economic growth.

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