RBI FSR: Banks Show Strong Resilience Amid Severe Stress, Capital Buffers Adequate

• RBI's macro stress test confirms Scheduled Commercial Banks (SCBs) remain resilient to adverse macroeconomic shocks over the medium term.
• Aggregate Capital to Risk-weighted Assets Ratio (CRAR) projected to stay above the 9% regulatory minimum, even under severe hypothetical stress scenarios.
• Common Equity Tier 1 (CET1) capital ratio also projected to meet the 8% minimum requirement across all scenarios.
• Gross Non-Performing Assets (GNPA) ratio is expected to rise under stress conditions but remains manageable, reaching 4.2% under the most severe scenario.
• While most banks are robust, a few might need to utilize their Capital Conservation Buffer (CCB) without fresh capital infusion under adverse scenarios.

Why It Matters: Indian banks are well-capitalized and resilient to severe economic shocks, as per RBI's stress test.