Question: Consider the following statements :-

  1. Economically important banks are those whose total assets are more than 2% of the national gross domestic product (GDP).
  2. SBI, ICICI and HDFC Bank will continue to be identified as domestic systemically important banks.
    Which of the above statements is/are correct?
    (a) 1 only
    (b) 2 only
    (c) 1 and 2
    (d) neither 1 nor 2
    Answer—(c)
    Related facts—
  • RBI on January 2022 said state-owned SBI, along with ICICI Bank and HDFC Bank continue to be Domestic Systemically Important Banks (D-SIBs) or institutions which are 'too big to fail'.
  • SIBs are perceived as banks that are 'too big to fail (TBTF)'.
  • This perception of TBTF creates an expectation of government support for these banks in times of distress. Due to this perception, these lenders enjoy certain advantages in the funding markets.
  • It is notable that framework for dealing with D-SIBs was issued in July 2014.

Link:
https://timesofindia.indiatimes.com/business/india-business/sbi-icici-bank-hdfc-bank-continue-to-remain-systemically-important-banks-rbi/articleshow/88695426.cms