Mumbai, Feb 9: Banks mobilised a record Rs 1,17,098 crore in demand deposits, largely through current accounts, in January on account of IPOs during the month. Foreign exchange (forex) reserves, on the other hand, rose $4.3 billion during the week ended February 1.

According to the latest figures released by the Reserve Bank of India in its weekly statistical supplement (WSS), demand deposits with commercial banks rose Rs 1,17,098 crore in January to Rs 5,56,054 crore.

A bulk of this came from application money of IPOs floated in January which lies with the custodian banks of the IPO issuer. Though the issuer does not earn any return on these funds, banks earn a float by deploying funds in treasury.

Total deposits with commercial banks rose Rs 1,75,916 crore during the month to Rs 31,17,691 crore as on January 5, '08 since term deposits rose Rs 58,818 crore during the week. Loans grew Rs 60,546 crore to Rs 21,82,311 crore.

While food credit dipped Rs 451 crore, non-food credit rose Rs 60,546 crore. Banks have revived their interest in government bonds with deposits showing a strong growth. They have to park a portion of the deposits in bonds. Bond investment tends to go up as deposits grow.

Foreign exchange reserves, including gold and SDR rose $4.3 billion during the week to cross the $290-billion mark with a lot of foreign money going towards funding IPOs. Total forex reserves, including gold and SDR rose $4356 million during the week ended February 1 to $292.7 billion.

While foreign currency assets rose $3,496 million, the value of gold in reserves rose $871 million during the week. Though the value of SDR in reserves remained unchanged, reserves with the IMF dipped $11 million.

Among other developments reported in the WSS, neither the central not state governments resort to any WMA (way and means advance) - a temporary advance to meet their revenue mismatches. On the other hand, the Centre has reduced its surplus with the central bank by Rs 11,445 crore during the week to Rs 39,312 crore.

Typically, the government tends to pile up its unspent revenue with the central bank towards the end of fiscal to contain fiscal deficit by reining in expenditure.