International Monetary Fund. Monetary and Capital Markets Department
INTERNATIONAL MONETARY FUND
The RBI is to be commended for the remarkable progress in strengthening banking
supervision since the last FSAP. Supervision and regulation by the RBI remain strong and have
improved in recent years. A key achievement is implementation of a risk-based supervisory
approach that uses a complex supervisory assessment framework to guide the intensity of
supervisory actions and the allocation of supervisory resources. Also, most of the Basel III
framework (and related guidance) has been implemented and cooperation arrangements, both
domestically and cross-border, are now firmly in place. The system-wide asset quality review
(AQR) and the strengthening of prudential regulations in 2015 testify to the authorities'
commitment to transparency and a more accurate recognition of banking risks.