The Reserve Bank has expanded the overseeing committee (OC) by appointing three more members to the high-level panel that will vet the process to resolve mounting bad loans bogging down the banking sector.
The Reserve Bank has expanded the overseeing committee (OC) by appointing three more members to the high-level panel that will vet the process to resolve mounting bad loans bogging down the banking sector. Former chief vigilance commissioner Pradeep Kumar will head the now five-member panel that will work through multiple benches, the RBI said in a statement.
In addition to Pradeep Shah and Janki Ballabh, former chairman of State Bank of India, the three new members of the commitee are: MBN Rao, former chairman of Canara Bank; YM Deosthalee, CFO of L&T Group, and S Raman, whole time member of Sebi, the central bank said in the notification.
The OC would work through multiple benches as may be necessary and constituted by chairman Pradeep Shah to opine on the cases referred to it by the banks, the central bank said. “The reconstituted OC will work with an expanded mandate to review, in addition to cases being restructured under the Scheme for Sustainable Structuring of Stressed Assets (S4A), resolution of other cases where the aggregate exposure of the banking sector to the borrowing entity is greater than Rs500 crore,” the notification said.
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After the promulgation of the Banking Regulation (Amendment) Ordinance, 2017 last month, the central bank had said it would reconstitute the OC and expand it to include more members. It had also said it was planning to expand the scope of cases to be referred to the OC beyond those under S4A. Since then, the OC has been brought under the aegis of the RBI. In June 2016, the central bank had formulated the S4A as an optional framework for the resolution of large stressed accounts. The OC was set up by the Indian Banks Association in consultation with the RBI, and comprised eminent experts who would independently review the processes involved in preparation of the resolution plan under the S4A. The RBI also said details of the process to be followed by banks for resolution of identified stressed assets within six months would be issued separately.