When it comes to depositing money in banks, the first question that comes to mind is where and how safe the money will be. In such a situation, RBI has recently included the names of one government and 2 private banks in the list of the safest banks in the country.
More detailed information about RBI's safest banks and D-SIBs:
What are D-SIBs?
D-SIBs stand for "Domestic Systemically Important Banks". These banks are so important that if they fail, the entire economic system of the country will be affected. The failure of these banks creates financial instability, due to which special limits and rules are imposed to keep these banks safe.
D-SIB banks are known as "Too Big to Fail". This means that the government and RBI will take necessary steps to save these banks.
Selection process as D-SIB
The RBI evaluates various banks every year and designates such banks as D-SIBs. The evaluation criteria include the following points:
The percentage of the bank – its share or role in the overall banking system.
The bank’s risk in the international and domestic banking market.
The importance of the bank for financial market stability.
The total amount of deposits and advances of the bank.
Banks listed as D-SIBs
The list of D-SIBs announced by the RBI in 2022 includes these three banks:
1. State Bank of India (SBI)
The largest public sector bank in India.
Its role in the entire financial system is the largest.
From April 1, 2025, SBI will have to maintain an additional 0.80% CET1 for risk-weighted assets.
2. HDFC Bank
One of the largest private banks in India.
It has a strong presence in the financial market.
From April 1, 2025, HDFC Bank will have to maintain an additional 0.40% CET1.
3. ICICI Bank
Another important bank in the Indian private sector.
This bank will have to maintain an additional 0.20% CET1.
How many types of certificates are required?
Banks declared as D-SIBs have to maintain additional financial capacity in three ways:
Additional Common Equity Tier-1 (CET1):
Additional reserves are created for these banks, which can withstand economic shocks.
Risk management:
D-SIBs have to maintain a system to respond to specific risks.
Additional regulations:
RBI monitors D-SIBs and the regulations related to them are also stricter.
Aim to protect systemically important banks
If a D-SIB suffers financial losses, it can have an impact on the entire banking system. In such a situation, the government and RBI provide the necessary financial support to protect them.
New changes
From April 1, 2025, under the new RBI rules, the CET1 level for banks listed as D-SIBs will be increased. The changes will be as follows:
SBI: CET1 will increase from 0.60% to 0.80%.
HDFC Bank: CET1 will increase from 0.20% to 0.40%.
ICICI Bank: CET1 will have to be maintained at 0.20%.
Is this list beneficial for citizens?
This list gives citizens an idea of which banks are safer.
Read in Gujarati Click Here
People who are thinking of opening an account in a new bank can choose D-SIBs, as these banks are under close supervision of the government and are less likely to fail.
In this way, this list by RBI is an attempt to strengthen citizens and the financial system.
Note:
Before adopting any health tips, consult a doctor. Because no one knows better than your doctor what is appropriate or how appropriate for your body
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Note:
Before adopting any health tips, consult a doctor. Because no one knows better than your doctor what is appropriate or how appropriate for your body