RBI governor says revised circular on resolution of stressed assets in 3-4 days

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Published: June 7, 2019 3:51:56 AM

“It has taken a little more time than we had originally anticipated but it will be issued very shortly. And very shortly means in a matter of 3 or 4 days,” RBI governor Shaktikanta Das told reporters at a post-monetary policy conference.

RBI governor, Shaktikanta Das, Supreme Court, Insolvency and Bankruptcy Code, stressed assets, resolution of stressed assetsDas suggested the delay was “because it involved examining various legal issues, it involved very detailed and wide-ranging stakeholder consultations and then internally we had to examine it in detail.”

The Rbi will finally issue a revised circular on resolution of stressed assets within the next three to four days after legal and internal examinations delayed the release beyond earlier expectations. “It has taken a little more time than we had originally anticipated but it will be issued very shortly. And very shortly means in a matter of 3 or 4 days,” RBI governor Shaktikanta Das told reporters at a post-monetary policy conference.

Das suggested the delay was “because it involved examining various legal issues, it involved very detailed and wide-ranging stakeholder consultations and then internally we had to examine it in detail.” The revised circular will replace the regulator’s original framework on resolution of stressed assets that introduced the concept of one-day default and directed banks to refer large account of Rs 2,000 crore and above to bankruptcy court unless a resolution plan was agreed upon within 180 days. The circular was declared as “ultra vires” by the Supreme Court in April this year.

The circular issued in 2018, also popularly referred to as the ‘Feb.12 circular’ was intended to be a simplified generic framework for resolution of stressed assets that was in harmony with the Insolvency and Bankruptcy Code, 2016.

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