The Reserve Bank of India is contemplating to introduce a revised set of guidelines on reorganizing loans after the supreme court decided to turn down its February 2018 circular on stressed assets, Governer Shaktikanta Das said today.
“The validity of section 35AA stands and henceforth we have to comply with the directions of the Supreme Court in this regard and act accordingly. In light of the Honorable Supreme Court’s order, Reserve Bank of India will take necessary steps including the issuance of a revised circular as may be necessary for expeditious and effective resolution of stressed assets,” Das said. “The RBI stands committed to maintain and enhance the momentum of resolution of stressed assets and adherence to credit discipline.”
The section was introduced by the government in the form of an ordinance in May 2017 and was later legislated. Following this, the regulator had created a list of 12 large corporate accounts where banks were asked to invoke the Insolvency and Bankruptcy Code to resolve them.
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