Many people open bank accounts to keep their money safe and earn interest. Once we deposit our money, we naturally feel secure.
However, no one can predict if a bank might face financial trouble or go bankrupt. This could put your savings at risk. If you want to make sure your money is safe, this information is important.
RBI Declares the Safest Banks
The Reserve Bank of India (RBI) has identified State Bank of India (SBI), HDFC Bank, and ICICI Bank as the safest banks in the country.
These banks are called Domestic Systemically Important Banks (D-SIBs) because they are very important for India’s financial system. The RBI confirms that these banks hold a highly significant position in the banking sector.
Why These Banks Are Considered Safe
These banks were classified as D-SIBs in 2024 due to their large size and importance to the economy.
D-SIBs are so vital that if any one of them fails, it could seriously affect the entire financial system.
Because of this, the government and regulators take extra steps to make sure these banks remain stable and do not fail.
Extra Capital Requirements
RBI rules require high-risk banks to keep additional capital called Common Equity Tier 1 (CET1). This extra money helps the banks handle financial shocks or losses.
The additional CET1 capital each bank must maintain is:
SBI: Bucket 4 → 0.80% extra CET1
HDFC Bank: Bucket 2 → 0.40% extra CET1
ICICI Bank: Bucket 1 → 0.20% extra CET1
Understanding D-SIBs
The RBI introduced the concept of D-SIBs in 2014 to strengthen financial stability. The first identification happened in 2015.
These banks are closely monitored because any problem in them can affect the whole economy. If trouble arises, the government is usually the first to step in and support them.
How Safe Is Your Money?
If a bank collapses, the maximum amount you can get back from your deposits is ₹5 lakh, even if your account balance is higher. If your balance is less than ₹5 lakh, you will receive the full amount.
Bank deposit insurance is provided by the Deposit Insurance and Credit Guarantee Corporation (DICGC), a subsidiary of the RBI.
Earlier, the insurance limit was only ₹1 lakh, but it was increased to ₹5 lakh in 2020.
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