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The Reserve Bank of India (RBI) on Monday set up a committee to undertake a comprehensive review of the working of asset reconstruction companies (ARCs) in the financial sector ecosystem and recommend suitable measures for enabling them to meet the growing requirements.
The six-member committee will be headed by Sudarshan Sen, former Executive Director, RBI. Earlier this month, the RBI had announced setting up of a committee to undertake a comprehensive review of the working of ARCs.
According to the RBI, as per the terms of reference of the committee, the panel will review the existing legal and regulatory framework applicable to ARCs and recommend measures to improve efficacy of ARCs.
The panel will also review role of ARCs in resolution of stressed assets including under Insolvency and Bankruptcy Code (IBC), and give suggestions for improving liquidity in and trading of security receipts. It has also been asked to review business models of the ARCs.
“The committee will submit its report within three months from the date of its first meeting. Department of Regulation, Reserve Bank of India, will provide the necessary secretarial support to the Committee,” the central bank said.
