Government has come up with a new proposal for redefining the regulatory structure of large financial institutions. The proposal suggests setting up "a college of supervisors". This college would comprise of representatives from several regulatory agencies.

The discussion paper on the establishment of the Financial Stability and Development Council (FSDC) has said that these large financial bodies have a big role to play in the financial services sector.

Big names like State Bank of India, ICICI Bank, HDFC Bank are regulated by Reserve Bank of India. But RBI only regulates the banking arms of these entities which have now diversified themselves into the insurance, mutual funds, pension management companies and many other segments.

"At present, each of these (institutions) have numerous subsidiaries operating in all the silos of Indian finance. Each regulator sees one or more subsidiaries operating in its silo. However, the overall picture is not fully known to any arm of government/regulatory agencies," the report says.

Finance Minister Pranab Mukherjee had announced the setting up of the FSDC in Budget 2010-11.