BANKING AFFAIRS

BANKING GENERAL KNOWLEDGE

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Reserve Bank of India labelled HDFC Bank as DSIBs in other words, ‘too big to fail’. DSIBs stands for
A
Domestic Systemically Important Below
B
Domestic Systemically Important Base
C
Domestic Systemically Important Banks
D
Domestic Systemically Important Branch
Explanation: 

Detailed explanation-1: -A D-SIB is a bank that is considered to be so important to the financial system that its failure could cause significant disruption. As a result, these banks are required to maintain higher capital buffers to protect against potential losses and ensure their stability.

Detailed explanation-2: -On Monday, the Reserve Bank of India (RBI) issued its list of Domestic Systemically Important Banks (D-SIBs) for 2021. In line with the 2020 list of D-SIBs, SBI, ICICI Bank, and HDFC Bank are still categorized as Domestic Systemically Important Banks (D-SIBs), according to the central bank.

Detailed explanation-3: -State Bank of India, ICICI Bank, and HDFC Bank continue to be identified as Domestic Systemically Important Banks (D-SIBs), under the same bucketing structure as in the 2021 list of D-SIBs.

Detailed explanation-4: -The RBI on Monday said state-owned SBI, along with private sector lenders ICICI Bank and HDFC Bank continue to be Domestic Systemically Important Banks (D-SIBs) or institutions which are ‘too big to fail’. SIBs are perceived as banks that are ‘too big to fail (TBTF)’.

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