SBI, ICICI and HDFC Bank retain systemically important tag, need to keep higher capital buffers: RBI

Reserve Bank Names Top Indian Banks as Systemically Important Institutions

The Reserve Bank of India (RBI) has designated State Bank of India (SBI), HDFC Bank, and ICICI Bank as 'domestic systemically important banks', a category that requires them to hold additional capital buffers.

Additional Capital Requirements

The three lenders will be required to hold additional capital buffers as a percentage of their risk-weighted assets (RWAs), over and above the Capital Conservation Buffer, as per the RBI.

• SBI Additional Capital Requirement: 0.80% of RWAs
• HDFC Bank Additional Capital Requirement: 0.40% of RWAs
• ICICI Bank Additional Capital Requirement: 0.20% of RWAs

History of D-SIB Designation

The RBI first issued the 'Framework for dealing with Domestic Systemically Important Banks (D-SIBs)' on July 22, 2014, which was subsequently updated on December 28, 2023.

The D-SIB framework requires the RBI to disclose the names of banks designated as D-SIBs starting from 2015 and place these banks in appropriate buckets depending upon their Systemic Importance Scores (SIS).

Timeline of D-SIB Designation

• 2015: SBI and ICICI Bank were classified as D-SIBs
• 2016: ICICI Bank was re-designated as a D-SIB
• 2017: HDFC Bank was classified as D-SIB along with SBI and ICICI Bank

According to an official statement, HDFC Bank was classified as a D-SIB in 2017, alongside SBI and ICICI Bank.