India has well-regulated banking sector

Reserve Bank of India Governor Shaktikanta Das on Friday gave a thumbs up to the country’s banking system, while stressing how recent developments in the US have brought to the fore the criticality of banking sector regulation and supervision.

“What we have in India today is a well-regulated and well-supervised banking sector. The same would apply to the NBFCs sector and other financial entities under the RBI’s domain,” he said while delivering the K.P. Hormis Commemorative Lecture here.

Hormis was the founder of the Kerala-headquartered Federal Bank.

Das pointed out that the focus is now more on identifying the root cause of vulnerabilities, rather than dealing with the symptoms alone.

“We have also issued revised guidelines on oversight and assurance functions of financial entities. Use of advanced data analytics is supplementing our supervisory process. To strengthen cyber resilience, a comprehensive cyber security framework for banks together with Digital Payment Security Control Guidelines have been issued. We have also established the college of supervisors and augmented the staff strength significantly in recent years,” he said.

Das focussed on how the recent developments in the US banking system have brought to the fore the criticality of banking sector regulation and supervision.