Systemically Important Banks (SIBs)

Systemically Important Banks (SIBs) are large financial institutions whose failure could cause significant disruption to the entire financial system and economy. Due to their size, interconnectedness, and critical role in providing banking services, they are subject to stricter regulations and oversight to prevent such risks. These regulations aim to ensure that SIBs maintain higher capital reserves and risk management standards, reducing the chance of their collapse and protecting the broader financial stability. Essentially, SIBs are "too big to fail" institutions whose health is vital for the economy's stability.