Deposit growth of foreign banks’ Indian branches decelerated to 6.8% in FY25, shows RBI data

Reserve Bank of India

Foreign banks’ branches in India saw a slowdown in deposit growth during FY25, expanding by 6.8 percent compared with 16.4 percent a year ago, numbers from Reserve Bank of India showed.

As per data, the deposit mobilised by foreign bank branches in India stood at $129.5 billion in FY25 as compared to $121.2 billion a year ago. In rupee terms, this amounts to Rs 11.08 lakh crore in FY25 as compared to Rs 10.10 lakh crore a year ago.

Foreign banks in India registered a robust credit growth of 8.4 percent during 2024-25, a marginal increase from 8.1 percent in the previous year.

During 2024-25, the fee income of foreign banks in India increased by 9.4 percent while that of overseas branches of Indian banks grew by 4.3 percent. Over two-third of the total fee income was generated from credit-related services, derivative, stock and securities, forex trading services, payment and money transmission services, and trade finance, RBI said.

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Indian banks expanded their overseas presence during FY25 through the subsidiary/joint venture route, with the number of branches and employees rising by 1.9 percent and 6.1 percent respectively over the previous year.

Considering Indian bank branches and their subsidiaries together, the total employee strength increased by 3.4 percent in FY25.

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During the year, both lending and deposit mobilisation by the overseas branches of Indian banks strengthened, recording growth of 5.6 percent and 9.4 percent respectively in USD terms, RBI release added.

Branches of Indian banks in Hong Kong, among operating economies, generated the highest fee income, recording a substantial increase over the previous year and moving up from fourth to the top position. In contrast, fee income from the branches of Indian banks in the United Kingdom (UK) registered a sharp decline, causing its ranking to fall from the top position to fourth compared to last year, RBI said.