SBI, HDFC, ICICI banks critically important: RBI
In a statement, the RBI said that while ICICI Bank continues to be in the same bucketing structure as last year, SBI and HDFC Bank moved to higher buckets.
Reserve Bank of India
MUMBAI: Reserve Bank said SBI, HDFC Bank and ICICI Bank continue to be identified as Domestic Systemically Important Banks (D-SIBs) or institutions which are ‘too big to fail’.
The D-SIB Framework requires the RBI to disclose the names of banks designated as D-SIBs every year in August, starting from August 2015. The framework also requires that D-SIBs may be placed in four buckets depending upon their Systemic Importance Scores (SISs).
In a statement, the RBI said that while ICICI Bank continues to be in the same bucketing structure as last year, SBI and HDFC Bank moved to higher buckets.
SBI shifted from bucket 3 to bucket 4 and HDFC Bank moved from bucket 1 to bucket 2, meaning the lenders will have to meet higher additional Common Equity Tier 1 as a percentage of Risk Weighted Assets (RWAs).
The higher D-SIB surcharge for SBI (0.8 per cent) and HDFC Bank (0.4 per cent) will be applicable from April 1, 2025.
Hence, up to March 31, 2025, the D-SIB surcharge applicable to SBI and HDFC Bank will be 0.60 per cent and 0.20 per cent, respectively, the RBI said.
The additional CET1 requirement will be in addition to the capital conservation buffer.
The central bank had announced SBI and ICICI Bank as D-SIBs in 2015 and 2016.