SBI, HDFC Bank, ICICI Bank maintain their current status as systemically important banks: RBI

The Reserve Bank of India (RBI), on Monday, confirmed that State Bank of India, ICICI Bank, and HDFC Bank all meet the criteria to be classified as Domestic Systemically Important Banks (D-SIBs). Phased in beginning on April 1, 2016, the increased Common Equity Tier 1 (CET1) requirement for D-SIBs went into full effect on April 1, 2019.

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, according to an RBI statement.

On July 22, 2014, the Reserve Bank announced the Framework for dealing with Domestic Systemically Important Banks (D-SIBs). Beginning in 2015, the D-SIB framework mandates the RBI to reveal the names of banks classified as D-SIBs and place these lenders in relevant categories based on their Systemic Importance Scores (SISs). Depending on the bucket in which a D-SIB is put, an additional common equity requirement has to be applied to it.

In 2015 and 2016, the Reserve Bank designated SBI and ICICI Bank as D-SIBs. Based on data collected from banks as of March 31, 2017, HDFC Bank, along with SBI and ICICI Bank, was designated as a D-SIB. The most recent revision is based on bank data collected as of March 31, 2022.

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