DFS Secretary urges banks to strengthen risk management
Nagaraju, Secretary of the Department of Financial Services (DFS), has urged banks to further strengthen risk management frameworks amid increasing global economic uncertainty and market volatility. The remarks reflect growing emphasis on financial resilience, governance, and proactive risk oversight within the banking sector.
Industry experts note that global challenges such as geopolitical tensions, inflationary pressures, cyber threats, fluctuating interest rates, and economic slowdowns are creating a more complex operating environment for financial institutions. Banks are therefore being encouraged to improve preparedness and maintain strong internal control systems.
The call for stronger risk management includes enhancing credit risk monitoring, operational resilience, cybersecurity preparedness, and capital management practices. Experts believe robust enterprise risk management frameworks are becoming increasingly important for protecting financial stability and maintaining investor confidence.
The banking sector is also undergoing rapid digital transformation, which is improving efficiency but simultaneously increasing exposure to technology-related risks. Industry observers note that banks must balance innovation with governance, compliance, and operational safeguards.
Regulators and policymakers are increasingly focusing on stress testing, data-driven risk assessment, and governance accountability to ensure banks remain resilient against external shocks. Experts emphasise that effective risk management is no longer limited to compliance functions but has become a strategic requirement for sustainable growth.
As India’s financial ecosystem continues expanding, strengthening resilience and maintaining prudent risk practices are expected to remain key priorities for the banking sector.
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