Informist, Wednesday, Dec 27, 2023

--Banking secy: Global econ facing macro, geopolitical challenges 

--While growth remains on track, inflation moderating 

--India's CAD remains imminently manageable 

--Banks in position of strength, resilience 

--Delinquencies in banking system at historic low 

--Fincl sector in India largely stable, resilient 

--Outlook for Indian econ realistically optimistic 

--Consumer confidence remains positive 

--Tie-ups between bks, fintech cos improved client svcs 
--Fintech cos need to upgrade tools to deal with deepfake 
--Banks need to upgrade tools to deal with deepfakes 
--Bks should add cyber stress testing in risk assessment 
--Insurance sector has grown but see ample opportunity 

MUMBAI – Banks and financial companies need to include cyber stress testing while assessing risk, Department of Financial Services Secretary Vivek Joshi said today at the 10th SBI Banking and Economics Conclave.

"The government, in close coordination with various stakeholders, has taken a number of critical steps to ensure that robust cybersecurity measures are being put in place by the banks. However, financial institutions, particularly banks, need to move a notch up now and should include stress testing of cyber risks as part of the risk assessment to gauge the impact in case any cyber attack occurs," Joshi said.

He said that the tie-ups between banks and financial technology companies have improved customer services, but banks need to upgrade their tools to deal with threats such as deepfakes. 

Joshi also said that India's banking sector remains sound and resilient and is majorly aided by the improvement in asset quality, stable credit growth and robust earnings growth. He also said that delinquencies of banks have been at historically low levels.

"Indian banks are better off than most of the American and European counterparts who are recognised as role models," Joshi said.

He also said that at the macro level, the outlook for the Indian economy is realistically optimistic. "Evidence from high-frequency indicators points towards sustained strength in consumer demand. Consumer confidence remains positive. Supply-chain pressures remain below historic levels," he said.

He said that the focus on fostering capital expenditure and new investment in the economy has been sharp and intense. "What is needed now is a new cycle of private investment. The need of the hour is to think big and to think bold by ensuring that execution remains timely and robust," he said.

State Bank of India Chairman Dinesh Khara in a separate panel said that he expects more capital expenditure from banking sector going ahead. He also said that banks and financial institutions need to reassess if their role should include support for project conceptualisation and structuring.

Joshi said that the global economy continues to face macroeconomic and geopolitical challenges. He said that while growth remains on track, inflation is on the path of moderation. He also said that the current account deficit remains imminently manageable. 

India's current account deficit shrunk to $8.3 bln in Jul-Sep, marking a substantial decrease from $30.9 bln recorded in the same quarter last year. As a percentage of GDP, the current account deficit was 1.0% of GDP, compared to the 3.8% reported a year ago, the Reserve Bank of India.

Separately, he said that even though the insurance industry has growth into double digits, there is still a lot of scope for insurance penetration in the country.  End

US$1 = 83.3450 rupees

Reported by Kshipra Petkar

Edited by Aditya Sakorkar

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