The Reserve Bank had issued the Framework for dealing with Domestic Systemically Important Banks (D-SIBs) on July 22, 2014, which was subsequently updated on December 28, 2023. #SBI #HDFC #ICICI

𝐃𝐒𝐈𝐁𝐬, 𝐬𝐡𝐨𝐫𝐭 𝐟𝐨𝐫 𝐃𝐨𝐦𝐞𝐬𝐭𝐢𝐜 𝐒𝐲𝐬𝐭𝐞𝐦𝐢𝐜𝐚𝐥𝐥𝐲 𝐈𝐦𝐩𝐨𝐫𝐭𝐚𝐧𝐭 𝐁𝐚𝐧𝐤𝐬, 𝐚𝐫𝐞 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐢𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐢𝐨𝐧𝐬 𝐭𝐡𝐚𝐭 𝐡𝐚𝐯𝐞 𝐫𝐞𝐚𝐜𝐡𝐞𝐝 𝐚 𝐥𝐞𝐯𝐞𝐥 𝐨𝐟 𝐬𝐢𝐠𝐧𝐢𝐟𝐢𝐜𝐚𝐧𝐜𝐞 𝐰𝐡𝐞𝐫𝐞 𝐭𝐡𝐞𝐢𝐫 𝐨𝐩𝐞𝐫𝐚𝐭𝐢𝐨𝐧𝐬 𝐜𝐚𝐧 𝐬𝐢𝐠𝐧𝐢𝐟𝐢𝐜𝐚𝐧𝐭𝐥𝐲 𝐢𝐦𝐩𝐚𝐜𝐭 𝐭𝐡𝐞 𝐞𝐧𝐭𝐢𝐫𝐞 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐬𝐲𝐬𝐭𝐞𝐦 𝐚𝐧𝐝, 𝐜𝐨𝐧𝐬𝐞𝐪𝐮𝐞𝐧𝐭𝐥𝐲, 𝐭𝐡𝐞 𝐛𝐫𝐨𝐚𝐝𝐞𝐫 𝐞𝐜𝐨𝐧𝐨𝐦𝐲.

The D-SIB framework requires the Reserve Bank to disclose the names of banks designated as D-SIBs starting from 2015 and place these banks in appropriate buckets depending upon their Systemic Importance Scores (SISs).

Based on the bucket in which a D-SIB is placed, an additional common equity requirement has to be applied to it. In case a foreign bank having branch presence in India is a Global Systemically Important Bank (G-SIB), it has to maintain additional CET1 capital surcharge in India as applicable to it as a G-SIB, proportionate to its Risk Weighted Assets (RWAs) in India, i.e., additional CET1 buffer prescribed by the home regulator (amount) multiplied by India RWA as per consolidated global Group books divided by total consolidated global Group RWA.

The Reserve Bank had announced SBI and ICICI Bank as D-SIBs in 2015 and 2016 while HDFC Bank was classified as D-SIB in 2017 along with SBI and ICICI Bank. The current update is based on the data collected from banks as on March 31, 2024.

This is 2 month onld video, some candidates were asking about it, so if you want to understand the process then check it. Total Views till date are more than 5700. https://youtu.be/H6k5EFA8F-c?si=WkvgBTMcC_4qm7M0

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