Criteria for Global Systemically Important Banks ( G-SIBs ) by FSB vs Domestic Systemically Important Banks (D-SIBs) by RBI

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The major difference between BCBS methodology for G-SIB identification and RBI methodology for D-SIB identification is as follows:

S. No.

Point of difference

BCBS G-SIB identification methodology

RBI D-SIB identification methodology

1

Sample of banks

75 largest global banks based on financial year end Basel III leverage ratio exposure measure. National supervisors have the discretion to add any bank in the sample apart from 75 largest banks.

Banks having size (Basel III leverage ratio exposure measure) as a percentage of GDP equal to or more than 2%. Additionally five largest foreign banks, based on their size, will also be added in the sample.

2

Indicators

Five broad indicators:
1. Cross jurisdictional activity
2. Size
3. Interconnectedness
4. Substitutability and
5. Complexity

Four broad indicators as mentioned in BCBS’s framework for D-SIBs will be used:
1. Size
2.Interconnectedness
3. Substitutability and
4. Complexity

3.

Indicator weights

All indicators given equal weight with a cap to substitutability category weight

Size will be given a weight of 40% and other three indicators will be given a weight of 20% each

4.

Sub-indicators

Three sub-indicators for Complexity indicator:
1. Notional amount of OTC derivatives
2. Level 3 assets and
3. Trading and Available For Sales Securities

Level 3 assets for complexity indicator dropped and instead cross jurisdictional liabilities added.


" Framework for Dealing with Domestic Systemically Important Banks (D-SIBs) " - RBI

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