Web Sify
Follow us on
Mail
Print

RBI establishes supervisory colleges for SBI, ICICI Bank

Source : BUSINESS_STANDARD
Last Updated: Wed, Dec 05, 2012 03:52 hrs

In a first, the Reserve Bank of India (RBI) has set up a supervisory college each for the State Bank of India (SBI) and ICICI Bank, to deal with “supervisory issues revolving around these banks and establish a cooperation mechanism for cross-border supervision”.

The central bank said in a statement that these banks were chosen because both have substantial cross-border presence and thus were chosen for the supervisory college.

While SBI is the largest bank in the country with the largest number of foreign officers among Indian banks, ICICI Bank is the largest private sector lender, with a significant presence abroad. The SBI will have nine host country supervisors, while ICICI Bank will have seven of them.

The concept of supervisory college was put forward in the Basel Committee for Banking Supervision (BCBS) October 2010 Document, “Good Practice Principles on Supervisory Colleges”.

Supervisory colleges have evolved the world over as an important component of effective supervisory oversight of an international banking group. This mechanism was developed with the aim of reducing supervisory overlap and filling supervisory gaps for better supervisory co-operation as enunciated in the Basel-II Framework, the banking regulator said.

The RBI said that although India does not have any systemically important banks (SIBs), the supervisory colleges will benchmark India with the best practices across the globe. The first meeting of supervisory colleges for SBI was held yesterday and for ICICI Bank on Tuesday in Mumbai.

K C Chakrabarty, deputy governor of RBI, said: “Supervisory colleges will become a key tool of consolidated supervision, particularly considering the ever expanding footprint of Indian banks abroad.”

SBI Chairman Pratip Chaudhuri and ICICI’s managing director and CEO, Chanda Kochhar, led the teams of the respective banks in the first meeting.




More from Sify:
blog comments powered by Disqus
most popular on facebook
talking point on sify finance