Indian financial sector is resilient despite lower capital ratios – RBI

Banks pass stress tests, but RBI warns of decline in capital ratios and problems at some non-banks

Reserve Bank of India HQ, Mumbai
Reserve Bank of India HQ, Mumbai

Indian banks passed stress tests in 2023, but capital ratios fell slightly and some non-banks remained vulnerable, the country’s central bank said on December 28.

All 46 major banks that underwent the Reserve Bank of India’s (RBI) latest stress tests remained above regulatory minimum capital levels in the “severe” scenario. But the central bank’s financial stability report highlighted a decline in risk-weighted capital across the banking sector, from 17.3% in March 2023 to 16.8% in September. 

The

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