RBI deputy governor calls for strengthening governance at small finance banks, ET LegalWorld

Boards of India’s small finance banks should remain vigilant for hidden and emerging risks that could jeopardise their long-term success, a deputy governor of the central bank said in a speech released on Monday.

“…they (small finance banks) should assess whether there is an overdependence on high-cost term deposits or bulk deposits from a limited number of institutions,” J. Swaminathan said.

The lenders should also evaluate any substantial asset exposures that could adversely impact them if they were to sour, he said.