With a view to strengthening the supervisory framework within the RBI, a Board for Financial Supervision (BFS) was constituted in 1994, comprising select members of the Reserve Bank’s Central Board with a variety of professional expertise to exercise “undivided attention to supervision” and ensure an integrated approach to supervision of commercial banks and financial institutions.
The Reserve Bank has also instituted Off-site Monitoring and Surveillance system for banks in 1995, which provides for Early Warning System as also a trigger for on-site inspections of vulnerable institutions.