Reserve Bank of India announces plan to list systemically important banks
Wednesday, July 23, 2014
The(RBI) posted a press release on its website yesterday stating it will identify up to six banks as domestic important banks (D-SIB), which would be equivalent to the banks of other nations.
RBI is to reveal the names of the banks every year in August, starting from 2015. The press release also said RBI had identified four to six banks to be under D-SIB category according to data compiled through March 2013.
The primary criterion to be used for selection of the banks is size — banks with size larger than 2% of the GDP () as defined by . Other criteria to be used are interconnectedness, how easily the bank can be substituted for, and its infrastructure and complexity. RBI also said four subcategories of D-SIBs will be created, each with different requirements, which will be higher compared to other banks. These four categories will have Tier 1 capital requirements ranging from 0.20% to 0.80% of their .
Ananda Bhoumik, senior director of India Ratings, a unit of, said the new regulations will not hinder the growth of the banks, as they already maintain capital above the expected regulation levels. Banks considered by analysts likely to be classified as D-SIBS include , , , , , and .
- "Reserve Bank of India to identify six systemically important banks" — , July 23, 2014
- "RBI to start announcing too-big-to-fail banks in Aug 2015" — , July 22, 2014
- The RBI Press Release (intermittent service)