The Reserve Bank of India (RBI) on Friday urged Small Financial Banks (SFBs) to focus on sustainable growth and give importance to business model and governance.
RBI Deputy Governors, MK Jain and Mr. Rajeshwar Rao held discussions with the Chief Executive Officers (MDs) and Chief Executive Officers (CEOs) of the SFBs. The executive directors of supervision and regulation and other senior RBI officials also attended the meeting, the central bank said in a statement.
“During the meeting, the emphasis placed on the importance due to these themes for the sustainable growth of SFBs, in particular their business model and governance, was reiterated after taking stock of developments in the sector. “, reads the press release.
SFBs were advised to continue to evolve in line with the differentiated banking license granted to them with a commensurate growth in their capital base.
“Among other issues, asset quality issues, including viable portfolio composition and further strengthening the customer service and grievance framework with commensurate IT resilience, were also discussed,” he said. declared.
Earlier in the meeting with the heads of the SFBs held in August 2021, the evolution of their business model and the need to strengthen the oversight and professionalism of the board of directors, to improve the functions insurance and increasing IT infrastructure, taking into account the accumulation of stress due to Covid-19 along with the necessary mitigation measures, were discussed.