The Reserve Bank of India has set up a supervisory college each for State Bank of India and ICICI Bank.
This move is to deal with supervisory issues revolving around these two banks and also establish a cooperation mechanism for cross-border supervision.
Though India does not have any systemically important banks, the RBI decided to establish a supervisory college each for SBI and ICICI Bank as both have vast expanse of overseas operations spreading across many supervisory jurisdictions, the RBI said in a statement.
Supervisory colleges have evolved the world over as an important component of effective supervisory oversight of an international banking group. This mechanism was developed to reduce supervisory overlap and fill in supervisory gaps for better supervisory co-operation enunciated in Basel II Framework.
For State Bank of India (SBI) there are nine host country supervisors in Bangladesh, Bahrain, Belgium, Dubai, the UK, Germany, Mauritius, Nepal and Singapore.
ICICI Bank has seven host country supervisors in Bahrain, Belgium, Dubai, United Kingdom, Germany, Russia and Singapore.
Inaugurating the first meeting of supervisory colleges for SBI and ICICI Ltd yesterday, K.C. Chakrabarty, Deputy Governor, RBI, said the college, being a process and not a one-time forum, will become a key tool of consolidated supervision particularly considering the ever expanding footprint of Indian banks abroad.