Domestic Systemically Important Banks (D-SIBs)

D-SIB Status: The Reserve Bank of India (RBI) has retained the State Bank of India (SBI), HDFC Bank, and ICICI Bank as Domestic Systemically Important Banks (D-SIBs) for 2024.
Bucketing: These banks remain in the same “buckets” as in the 2023 list:
- SBI: Bucket 4
- HDFC Bank: Bucket 3
- ICICI Bank: Bucket 1
What is a D-SIB?: D-SIBs are banks that are considered “Too Big To Fail” (TBTF), meaning their failure could disrupt essential banking services and the economy.

Risks: D-SIBs, due to their size and interconnectedness, can cause significant disruption if they fail.
Government Support: These banks are perceived to receive government support during times of distress, which can reduce market discipline and increase risks.

Additional Capital: D-SIBs must hold extra capital based on their systemic importance.
- SBI: Additional 0.80% of Risk-Weighted Assets (RWAs)
- HDFC Bank: Additional 0.40% of RWAs
- ICICI Bank: Additional 0.20% of RWAs
Effective Date: Higher capital requirements for SBI and HDFC Bank will take effect from April 1, 2025.

Selection Process:
- The RBI assesses banks for systemic importance using a range of indicators, such as size and interconnectedness.
- Banks with systemic importance above a certain threshold are classified as D-SIBs.
Bucketing: Banks are placed in different buckets based on their systemic importance score, with higher buckets attracting higher capital requirements.

Global List: The Financial Stability Board (FSB) has identified 29 G-SIBs for 2023, including major global banks like JP Morgan Chase, Bank of America, Citigroup, and HSBC.