INDIAN OVERSEAS BANK EXCELS IN
RISK MANAGEMENT
RATED INDIA INVOLVED BY SKOCH

Risk management at IOB is no longer a back-office function — it has become the central nervous system of the bank. The transformation began with the creation of an Interactive Capital Dashboard, a real-time tool that tracks capital adequacy ratios such as CRAR, CET1 and risk-weighted assets. More than a compliance necessity, the dashboard offers simulation capabilities, enabling management to visualise how different scenarios – from economic shocks to sectoral downturns – could impact the bank’s capital position. This has made strategic planning more data driven and agile.

The revamping of the ICAAP framework and the launch of a Risk Appetite Dashboard further strengthen this structure. These tools provide consolidated views of credit, liquidity and market risk indicators, while automated systems like the CARE Rating Tracker update external ratings in real time. By eliminating manual intervention, the bank has drastically reduced the risk of errors and improved the speed of reporting. For instance, during FY 2024-25, IOB achieved an impressive 99.38% coverage of borrower accounts rated using audited financials — a feat that not only enhances transparency but also reduces provisioning risks.

Stress testing across 19 industry sectors and the development of an in-house IRRBB model have further prepared IOB for market volatility, ensuring it can anticipate risks instead of reacting to them.

If Risk Management is IOB’s shield, IOB SMART is its spear. This integrated digital solution tackles a key challenge in secured lending: property valuation and climate risk assessment. Traditionally dependent on manual processes and pin-code-level data, the system now leverages latitude–longitude tagging to provide pinpoint accuracy. This small but crucial shift allows the bank to better assess physical climate risks — a factor increasingly vital in today’s environment-conscious economy.

Through a seamless portal and mobile app, valuations, legal opinions and climate assessments flow into a centralised repository. Branches, regional offices and risk committees can access reports in real time, cutting delays, ensuring consistency and faster approvals. By embedding ESG principles into both risk management and lending, IOB is not just futureproofing its operations — it is redefining what responsible banking looks like in the Indian context.

Partnerships with organisations such as PCAF and IGBC reinforce its commitment to green finance, while awareness campaigns like the IOB Resilient magazine and the ESG mascot Mr Harit embed sustainability consciousness across employees. Together, these projects reflect IOB’s leadership in combining technology, risk governance and sustainability to position itself as a forward-thinking, climate-conscious financial institution.