RBI governor Shaktikanta Das asks banks to strengthen governance, risk management

RBI governor Shaktikanta Das on Wednesday requested banks to additional strengthen the governance requirements, danger administration practices and compliance tradition.

As a part of the Reserve Financial institution’s steady engagement with the senior administration of its regulated entities, Das held conferences with the managing administrators (MDs) and chief govt officers (CEOs) of public sector banks and choose non-public banks.

The governor in his opening remarks famous the continued enchancment in banks’ asset high quality, mortgage provisioning, capital adequacy, and profitability, the RBI mentioned in a press release.

“Whereas acknowledging the upper resilience and power of the banking sector, he highlighted the significance of additional strengthening the governance requirements, danger administration practices and compliance tradition in banks,” Das mentioned.

Persisting hole between credit score and deposit progress; liquidity danger administration and ALM-related points; and traits in unsecured retail lending have been among the many points which have been mentioned at size.

Das additionally emphasised the necessity for banks to make sure strong cybersecurity controls and successfully handle third-party dangers.

He urged them to step up efforts in opposition to ‘mule accounts’ and in addition intensify buyer consciousness and training initiatives, amongst different measures, to curb digital frauds, the assertion mentioned.

Cybersecurity, third-party dangers, and digital frauds; strengthening of assurance capabilities; credit score flows to MSMEs; rising the utilization of Indian Rupee for cross-border transactions; and banks’ participation in innovation initiatives of the Reserve Financial institution too have been mentioned intimately.

The conferences have been additionally attended by deputy governors, M Rajeshwar Rao and Swaminathan J, together with govt directors-in-charge of regulation and supervision capabilities.The earlier such conferences have been held on February 14, 2024.