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IndusInd Bank closes first set of Structured Derivative Transactions – IBS Intelligence

IndusInd Bank closes first set of Structured Derivative Transactions

By Leandra Monteiro


  • Derivatives
  • GIFT City
  • IFSC Banking Unit

IndusInd BankIndusInd Bank has announced the closure of its first set of structured derivative transactions with its corporate clients in India after the Reserve Bank of India permitted complex derivative products w.e.f. January 3, 2022.

The Bank undertook Swaption and Forex Barrier Options trades with a large corporate client and a large diamond client. The hedges were for Forex and Interest Rate risk management by the clients.

Speaking about the development, Siddharth Banerjee, Head – Global Markets Group, IndusInd Bank said, “The RBI has revised the extant derivatives guidelines with the objective of promoting efficient access to derivatives while ensuring high standards of governance. This is a step in the right direction and will deepen Indian financial markets. Bank treasuries will play an active role in ensuring governance and in educating clients on the use for structured products as a risk management strategy. Going forward, we anticipate the demand for structured products to grow as clients start using structured derivatives”.

IndusInd Bank has been a front runner in the derivatives space in India and was amongst the first 4 banks who undertook INR Swaptions in the Institutional Inter Dealer market on August 17, 2021. It was also amongst the first set of banks who undertook Modified MIFOR trades in INR on December 20, 2021. The Bank has also undertaken Non Deliverable INR Forex Option hedges with its International corporate client base via its IFSC Banking Unit (IBU) located at the GIFT City SEZ.

IndusInd Bank is the first and only Indian Bank who is an active market maker in Non-Deliverable Forwards and Forex Options space in the Institutional Inter Dealer Broker Market for INR in Singapore and London via its IBU.

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