In a bid to retain Resurgent India Bond holders and attract other non-resident Indians, State Bank of India on Friday announced two new schemes for a limited period from September 24.
Pravasi Vaibhav is a deposit scheme denominated in rupee with payment of maturity proceeds in US dollar, while Pravasi Samriddhi will be booked at its three offshore banking units offering an opportunity for investment on floating or fixed interest rates on cumulative and non-cumulative basis, SBI said in a release.
SBI chairman A K Purwar said, "The innovative deposit schemes have been designed to give a wider choice to global Indians, who in today's environment need investment opportunities, which are secure and give good returns."
Under the Vaibhav scheme, the foreign currency received from the customer would be converted into rupees to issue a non-resident external special term deposit receipt for a year.
Simultaneously, a forward contract would also be booked to convert the NRE-STDR proceeds into US dollar on maturity.
At prevailing interest rates on NRE deposits, even after the cost of forward cover, NRIs would get an attractive yield on USD deposits compared to other options. The yield on Pravasi Vaibhav would depend upon the rates on NRE deposits and cost of forward cover prevailing on the date of issue.
RIBs, which mature on October 1 were issued in 1998 by SBI for five years and the total subscription was around $4.23 billion. Purwar had said that they expect to retain about 30-35 per cent of RIB holders.