The Reserve Bank of India has attributed the jump in deposits to the success of the Resurgent India Bonds (RIB) issue which closed on August 24. The triple-currency five-year instrument mopped up $4.18 billion. The RBI's weekly statistical supplement, released on Saturday, said that the aggregate deposits include RIB proceeds to the tune of Rs 17,945 crore.

In a parallel development, foreign exchange reserves in the week to September 4 grew by $1.05 billion to $28.55 billion. This was largely due to the growth in foreign currency assets to the tune of $1.14 billion. With this, foreign currency assets have been on the rise for three consecutive weeks now, registering a growth of over $2 billion.

The State Bank of India has been selling the RIB proceedsthrough a series of off-market deals with the RBI. SBI plans to bring in 75 per cent of the RIB proceeds through off-market deals. Sources close to the bank said it might end up bringing in over $3.5 billion as the avenues for profitable deployment of the RIB funds overseas have been limited.

The RBI has reduced its total outstanding forwards liabilities by $555 million between August 20 and the close of business on September 4.

The central bank has been able to do this due to the inflow of the RIB proceeds, an official spokesperson of the RBI said. Earlier on August 1, the RBI had said that it had reduced its forward contract liabilities by $515 million in the last 10 days of August.

In effect, RBI has reduced its outstanding contracts by an additional $40 million in the first four days of September.

The net RBI credit to the government during the week to August 28 fell by Rs 4,266 crore, indicating a decline of 2.9 per cent. This was on account of the open market operations carried out by the RBIwhere it sold nearly Rs 8,500 crore in government securities between April and September in the current fiscal.

Tracking the deposit growth, bank credit -- which has been witnessing a decline over the past few months -- has grown by Rs 1,734 crore for the fortnight ended August 28. While food credit has shown a decline of Rs 298 crore, non-food credit has grown by Rs 2,032 crore.

The total investments made by banks grew by 2 per cent (Rs 4,755 crore) during the fortnight ended September 12, primarily on account of investments in government securities (Rs 4,610 crore).