India’s financial system remains “completely” insulated from the recent developments in the US and Switzerland, RBI governor Shaktikanta Das said, asserting that the country’s banking system is resilient, stable and healthy.

The governor of the Reserve Bank of India (RBI) told a press conference here on Thursday that at the global level, the recent developments in the banking system in the US and in Switzerland, have once again, brought into focus the importance of financial stability and banking sector stability.

He was here for the annual spring meeting of the International Monetary Fund and the World Bank along with Union finance minister Nirmala Sitharaman.

Responding to a question on the collapse of the Silicon Valley Bank, he said the developments related to failures of banks in the US and also in Switzerland have naturally renewed a lot of interest.

“So far as India is concerned, the Indian banking system, the Indian financial system, remains completely insulated from the developments that have taken place in the US or in Switzerland. Our banking system is resilient, stable and healthy,” Das said.

“The parameters related to banking, whether it is capital adequacy, or it is the percentage of stressed assets or it is the liquidity coverage ratio of individual banks both at individual level as well as at the systemic level or issues like provision coverage ratio, aspects like net interest margin of banks, profitability of banks, whichever parameter you take into consideration, the Indian banking system continues to be very healthy,” he said.

Das said that as far as the Reserve Bank of India is concerned, over the last few years, “we have significantly improved and tightened our regulation and supervision of the entire banking system, including the non-banking financial companies”.

The focus of supervision is on early identification of any buildup of vulnerabilities and not waiting for the crisis to build up, the RBI governor said.

On the sidelines of the annual spring meeting, Das along with Sitharaman cochaired a meeting of finance ministers and central bank governors from member countries.

Issues related to cryptocurrency and its challenges were discussed at the meet.

Members of the G20 agree that a globally co-ordinated understanding would be required not only to deal with the challenges posed by crypto assets but also to regulate them, Sitharaman has said.

During India’s presidency of the G20, a “synthesis paper” will be taken up on matters related to crypto assets, the minister told a press conference here on Thursday.

Alliance for Lanka bailout

Washington: India, Japan and France have announced a common platform for talks among creditors to address the debt restructuring programme of Sri Lanka which is grappling with its worst economic crisis.

The representatives of the three creditor countries, including finance minister Nirmala Sitharaman, held a press briefing on the margins of the annual spring meetings of the World Bank and the IMF in Washington on Thursday.

“The purpose of the event was to demonstrate the multilateral co-operation regarding the debt restructuring process among the creditors, together with Sri Lanka,” said an official statement.

Sitharaman expressed India’s commitment to supporting Sri Lanka.

The finance minister emphasised that collaboration among creditors was important to ensure transparency and equality in the debt restructuring discussions.

Sri Lankan President Ranil Wickremesinghe joined the conference virtually.

Japanese finance minister Shunichi Suzuki described the launch of the common platform as a historical development.

“To be able to launch this negotiation process gathering, such a broad-based group of creditors, is a historical outcome,” he told reporters at the news conference.

“This committee is open to all creditors,” he said.

PTI