RBI to put in place early warning system to track bank health
1 Oct 2014 12:50 AM GMT
The central bank is also proposing to set up a Central Fraud Registry as a searchable centralised database for use by banks, RBI said in bi-monthly monetary policy.
‘An Early Warning System (EWS) is being put in place to track banks' critical financial parameters. Deviations from pre-defined benchmarks would trigger more granular oversight in the form of enhanced off-site monitoring, focused discussions, on-site examination and punitive action, if warranted,’ it said.
The move is aimed at taking timely action to ensure that financial institutions remain solvent. RBI has also announced that it will come out with guidelines for monitoring tools for intra-day liquidity management by October end.
‘An Early Warning System (EWS) is being put in place to track banks' critical financial parameters. Deviations from pre-defined benchmarks would trigger more granular oversight in the form of enhanced off-site monitoring, focused discussions, on-site examination and punitive action, if warranted,’ it said.
The move is aimed at taking timely action to ensure that financial institutions remain solvent. RBI has also announced that it will come out with guidelines for monitoring tools for intra-day liquidity management by October end.
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