RBI sets up supervisory bodies for SBI and ICICI Bank
The Reserve Bank today set up two supervisory bodies for State Bank of India and ICICI Bank to ensure compliance of global prudential norms and reduce supervisory overlap.
December 05, 2012 / 13:50 IST
The Reserve Bank set up two supervisory bodies for State Bank of India and ICICI Bank to ensure compliance of global prudential norms and reduce supervisory overlap. "The objective of establishing supervisory college is to deal with supervisory issues revolving around these banks and establish a cooperation mechanism for cross-border supervision," RBI said in a statement.
Supervisory colleges have evolved the world over as an important component of effective supervisory oversight of an international banking group, it said. This mechanism was developed with the aim of reducing supervisory overlap and filling in supervisory gaps for better supervisory co-operation enunciated in Basel II Framework, it said.The concept, it said, was enunciated in the Basel Committee for Banking Supervision (BCBS) October 2010 Document, "Good Practice Principles on Supervisory Colleges". Though India does not have any Systemically Important Banks (SIBs), with a view to benchmarking India with the best practices across the globe and in its capacity as the home country supervisor, the RBI decided to establish a supervisory college each for SBI and ICICI Bank. This is because both banks have vast expanse of overseas operations spreading across many supervisory jurisdictions.For SBI there are nine host country supervisors. These are, Bangladesh Bank, Central Bank of Bahrain, National Bank of Belgium, Dubai Financial Services Authority, Financial Services Authority (London), Federal Financial Services Authority (BaFin), Bank of Mauritius, Nepal Rastra Bank and Monetary Authority of Singapore. At the same time, ICICI Bank has seven host country supervisors including Central Bank of Bahrain, National Bank of Belgium, Financial Services Authority (London), Bank of Russia and Monetary Authority of Singapore.RBI Deputy Deputy Governor KC Chakrabarty hoped the college, being a process and not a one-time forum, will become a key tool of consolidated supervision particularly considering the ever expanding footprint of Indian banks abroad. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
