For this, eight banks will put the initial capital. These banks have committed to this. After the approval of the Reserve Bank, NARCL will increase its capital base to Rs 6,000 crore.
IBA will apply to the Reserve Bank regarding the bad bank.
The Indian Banks’ Association (IBA) will soon hold the National Asset Reconstruction Company Ltd. with the Reserve Bank of India with a proposed capital of Rs 6,000 crore. (NARCL) or Bad Bank (Bad Bank). Initially, the process of infusion of capital of Rs 100 crore has been done. IBA has got a license for this from the Registrar of Companies.
Sources gave this information. Sources said that after the registration of the company, the process of infusion of initial capital of Rs 100 crore is being done as per the guidelines. Its next step will be audit. Thereafter, IBA will apply for the Asset Reconstruction Company’s license to the Reserve Bank. In 2017, the Reserve Bank had increased the capital requirement from Rs 2 crore to Rs 100 crore. The central bank believes that more money is needed to buy bad loans.
Eight banks will put in working capital
The services of legal advisor AZB & Partners have been engaged to obtain various regulatory approvals. Along with this, it will also complete other legal formalities. Sources said that for this the initial capital will be put by eight banks. These banks have committed to this. After the approval of the Reserve Bank, NARCL will increase its capital base to Rs 6,000 crore.
The board of directors will also be expanded
Sources said that after the approval of the Reserve Bank, other equity participants will join it. Even its board of directors will be expanded. IBA has been given the responsibility of setting up a bad bank. The initial board of NARCL has been constituted.
P M Nair appointed managing director
The company has appointed SBI’s pressure assets expert P M Nair as Managing Director. Other directors on the board include IBA Chief Executive Sunil Mehta, SBI Deputy Managing Director SS Nair and Canara Bank Chief General Manager Ajit Krishna Nair.
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