Shaktikanta Das, RBI governor Shaktikanta Das told why the banking crisis came in the US, said – the business model of Indian banks is being monitored
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Das said the recent developments in the US raised questions whether the business model of individual banks was the right one. He said, ‘The Reserve Bank has now started keeping a close watch on the business model of banks. Any flaw in these can create a crisis. The business model can at times expose parts of the bank’s balance sheet to risk, which can later turn into a bigger crisis.
India’s financial system strong
Addressing a global conference on financial sector soundness on behalf of the Reserve Bank-promoted ‘College of Supervisors’, Das said, “India’s financial system remains robust and has not been adversely affected by financial instability in some modern economies.” Is.’ He has asked the management and boards of banks to regularly assess financial risks and focus on creating adequate funds and liquidity ‘buffers’. He said that this minimum regulation should be more than necessary for the continued strength and sustainable growth of banks.
Bad loan reduced to 4.41%
The governor said that Indian banks have registered improvement in the recent times on the stress and capital buffer front. The gross non-performing asset ratio (NPA) of banks came down to 4.41% in December 2022 from 5.8% in March 2022 and 7.3% as on March 31, 2021. Das said that the macro stress test for credit risk means that Indian banks will be able to comply with the minimum capital requirement even in the face of severe stress.
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Warned of cyber threats
Governor Shaktikanta Das also warned about cyber risk and cyber attack. He said that cyber risk is being seen as a top 10 operational risk in 2023 for global financial institutions. He said that with strong IT and information security governance, such risks can be detected in advance. Depositors who deposit money in banks have the largest share in the resources of banks, it is most important to take care of them.
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