RBI release 2020 list of Domestic Systemically Important Banks

The Reserve Bank had issued the Framework for dealing with Domestic Systemically Important Banks (D-SIBs) on July 22, 2014.

RBI release 2020 list of Domestic Systemically Important Banks

New Delhi: SBI, ICICI Bank, and HDFC Bank continue to be identified as Domestic Systemically Important Banks (D-SIBs), under the same bucketing structure as in the 2018 list of D-SIBs. The additional Common Equity Tier 1 (CET1) requirement for D-SIBs was phased-in from April 1, 2016, and became fully effective from April 1, 2019. The additional CET1 requirement will be in addition to the capital conservation buffer.

The Reserve Bank had issued the Framework for dealing with Domestic Systemically Important Banks (D-SIBs) on July 22, 2014. 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.

Based on the methodology provided in the D-SIB framework and data collected from banks as on March 31, 2015, and March 31, 2016, the Reserve Bank had announced State Bank of India and ICICI Bank Ltd. as D-SIBs on August 31, 2015, and August 25, 2016, respectively. Based on data collected from banks as on March 31, 2017, and March 31, 2018, the Reserve Bank had announced State Bank of India, ICICI Bank Ltd., and HDFC Bank Ltd. as D-SIBs on September 04, 2017, and March 14, 2019, respectively. The current update is based on the data collected from banks as of March 31, 2020.

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