In discharging its function towards maintaining financial stability, the Reserve Bank derives considerable systemic advantage from the its roles as the monetary authority, lender of last resort, regulator of the banking and non banking system and of key financial markets – money market, Government securities market, forex market and credit market.
From a financial stability perspective, the above framework has proved to be a sound model as evidenced by the resilience of the Indian financial system during various episodes of systemic instability in the global economy. VII. Challenges – going forward  It would perhaps be a truism to state that the last five years have been challenging.