On April 7, during the bi-monetary policy announcement, the Reserve Bank of India (RBI) had announced the setting up of a committee to undertake a comprehensive review of the working of Asset Reconstruction Companies (ARCs) in the financial sector ecosystem. Now, the banking regulator has invited views and suggestions from various stakeholders on various aspects of ARCs.
The views and suggestions are invited around: review of existing legal and regulatory framework applicable to ARCs and recommend measures to improve efficacy of ARCs; review of role of ARCs in resolution of stressed assets including under Insolvency & Bankruptcy Code (IBC), 2016; suggestions for improving liquidity in and trading of security receipts; review of business models of the ARCs; and any other matter relevant to the functioning, transparency and governance of ARCs.
RBI stated the committee “invites views and suggestions on the above aspects from ARCs, market participants and other stakeholders.”
The committee included Sudarshan Sen, former Executive Director, RBI as chairman and members of the committee are Vishakha Mulye, Executive Director, ICICI Bank; P N Prasad, former Deputy Managing Director, SBI; Rohit Prasad, Professor of Economics, MDI, Gurgaon; Abizer Diwanji, Partner, Ernst & Young; and R Anand, Chartered Accountant.
On April 19, RBI had stated the Committee will submit its report within three months from the date of its first meeting. It stated that the department of Regulation, Reserve Bank of India will provide the necessary secretarial support to the Committee.
