**Executive Summary**
This document is a press release from the Reserve Bank of India (RBI), dated June 30, 2025, announcing the release of the June 2025 issue of the Financial Stability Report (FSR). The FSR reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on the resilience of the Indian financial system and risks to financial stability. The press release provides highlights of the FSR.
**Key Points / Main Content**
* **Global Economy and Financial Markets:**
* Elevated economic and trade policy uncertainties are testing the resilience of the global economy and the financial system.
* Financial markets remain volatile due to shifting policies and geopolitical environment. Existing vulnerabilities, like high public debt and asset valuations, may amplify shocks.
* **Indian Economy:**
* The Indian economy remains a key driver of global growth due to sound macroeconomic fundamentals and prudent policies.
* The domestic financial system is resilient, supported by healthy balance sheets of banks and non-banks.
* Financial conditions have eased due to accommodative monetary policy and low financial market volatility.
* **Scheduled Commercial Banks (SCBs):**
* SCBs exhibit soundness and resilience due to robust capital buffers, low non-performing loans ratio, and strong earnings.
* Macro stress tests indicate that most SCBs have adequate capital buffers relative to regulatory minimums, even under stress.
* Stress tests validate the resilience of mutual funds and clearing corporations.
* **Non-Bank Financial Institutions:**
* Non-banking financial companies (NBFCs) remain healthy with sizable capital buffers, robust earnings, and improved asset quality.
* **Insurance Sector:**
* The consolidated solvency ratio of the insurance sector is above the minimum threshold.
**Impact Analysis**
**Stakeholder: Reserve Bank of India (RBI)**
**Impact**
The RBI released the Financial Stability Report (FSR), providing insights into the resilience of the Indian financial system.
**Action Required**
No immediate action called for.
**Stakeholder: Scheduled Commercial Banks (SCBs)**
**Impact**
SCBs are recognized for their soundness and resilience.
**Action Required**
No immediate action called for.
**Stakeholder: Non-banking financial companies (NBFCs)**
**Impact**
NBFCs are recognized for their health and asset quality.
**Action Required**
No immediate action called for.
**Stakeholder: Financial Stability and Development Council (FSDC)**
**Impact**
The report reflects their assessment of financial system resilience.
**Action Required**
No immediate action called for.
**Stakeholder: Insurance Sector**
**Impact**
The insurance sector is recognized for its solvency.
**Action Required**
No immediate action called for.
Key Entities Referenced
Financial Stability Report (FSR): A report released by the Reserve Bank of India reflecting the collective assessment of the Financial Stability and Development Council (FSDC) on the resilience of the Indian financial system.
Financial Stability and Development Council (FSDC): A council that assesses the resilience of the Indian financial system and risks to financial stability, whose assessment is reflected in the Financial Stability Report.
Reserve Bank of India: The central bank of India, responsible for releasing the Financial Stability Report.
Mumbai: Location of the Reserve Bank of India's central office.
प्रेस प्रकाशनी PRESS RELEASE
भारतीय ररज़र्व बैंक
RESERVE BANK OF INDIA
वेबसाइट : www.rbi.org.in/hindi संचार वर्भाग, केंद्रीय कायाालय, शहीद भगत ससिंह मागा, फोटा, म िंबई - 400 001
Website : www.rbi.org.in Department of Communication, Central Office, Shahid Bhagat Singh Marg, Fort,
ई-मेल/email : helpdoc@rbi.org.in Mumbai - 400 001 फोन/Phone: 022 - 2266 0502
June 30, 2025
RBI releases the Financial Stability Report, June 2025
Today, the Reserve Bank released the June 2025 issue of the Financial Stability
Report (FSR), which reflects the collective assessment of the Sub-Committee of the
Financial Stability and Development Council (FSDC) on the resilience of the Indian
financial system and risks to financial stability.
Highlights:
Elevated economic and trade policy uncertainties are testing the resilience of
the global economy and the financial system.
Financial markets remain volatile, especially core government bond markets,
driven by shifting policy and geopolitical environment. Alongside, existing
vulnerabilities such as soaring public debt levels and elevated asset valuations
have the potential to amplify fresh shocks.
Despite an uncertain and challenging global economic backdrop, the Indian
economy remains a key driver of global growth, underpinned by sound
macroeconomic fundamentals and prudent macroeconomic policies.
The domestic financial system is exhibiting resilience fortified by healthy
balance sheets of banks and non-banks. Financial conditions have eased
supported by accommodative monetary policy and low volatility in financial
markets. The strength of the corporate balance sheets also lends support to
overall macroeconomic stability.
The soundness and resilience of scheduled commercial banks (SCBs) are
bolstered by robust capital buffers, multi-decadal low non-performing loans
ratio and strong earnings.
Results of macro stress tests affirm that most SCBs have adequate capital
buffers relative to the regulatory minimum even under adverse stress
scenarios. Stress tests also validate the resilience of mutual funds and
clearing corporations.
Non-banking financial companies (NBFCs) remain healthy with sizable capital
buffers, robust earnings and improving asset quality.
The consolidated solvency ratio of the insurance sector also remains above
the minimum threshold limit.
(Puneet Pancholy)
Press Release: 2025-2026/624 Chief General Manager