Q12. Consider the following statements about New Insolvency rules announced by RBI:
1. Banks will have to file for insolvency proceedings against loan defaulters with Rs 20 billion ($311 million) or more if a resolution plan is not implemented within 180 days of the initial occurrence of a default.
2. Any process involving restructuring or change in ownership for large accounts with loans of 5 billion rupees or more will need independent credit evaluation by credit rating agencies that are authorized by the RBI.
Which of the following statements are correct?
Q12. Consider the following statements about New Insolvency rules announced by RBI:
1. Banks will have to file for insolvency proceedings against loan defaulters with Rs 20 billion ($311 million) or more if a resolution plan is not implemented within 180 days of the initial occurrence of a default.
2. Any process involving restructuring or change in ownership for large accounts with loans of 5 billion rupees or more will need independent credit evaluation by credit rating agencies that are authorized by the RBI.
Which of the following statements are correct?
The correct option is A a) 1 only
Under the new rules, banks will have to file for insolvency proceedings against loan defaulters with Rs 20 billion ($311 million) or more if a resolution plan is not implemented within 180 days of the initial occurrence of a default.
It warned that any failure on the part of banks to meet the prescribed timelines, or any actions they take to conceal the actual status of accounts or evergreen stressed accounts, will expose banks to potential monetary penalties and other actions.
t also tightened rules around resolution plans, saying any such process involving restructuring or change in ownership for large accounts with loans of 1 billion rupees or more will need independent credit evaluation by credit rating agencies that are authorized by the RBI.
Loans of Rs 5 billion or more will need two such independent evaluators
The RBI said all prior schemes, including the popular Strategic Debt Restructuring Scheme, the Scheme for Sustainable Structuring of Stressed Assets, and the Corporate Debt Restructuring Scheme, will be withdrawn with immediate effect
a) 1 only
Under the new rules, banks will have to file for insolvency proceedings against loan defaulters with Rs 20 billion ($311 million) or more if a resolution plan is not implemented within 180 days of the initial occurrence of a default.
It warned that any failure on the part of banks to meet the prescribed timelines, or any actions they take to conceal the actual status of accounts or evergreen stressed accounts, will expose banks to potential monetary penalties and other actions.
t also tightened rules around resolution plans, saying any such process involving restructuring or change in ownership for large accounts with loans of 1 billion rupees or more will need independent credit evaluation by credit rating agencies that are authorized by the RBI.
Loans of Rs 5 billion or more will need two such independent evaluators
The RBI said all prior schemes, including the popular Strategic Debt Restructuring Scheme, the Scheme for Sustainable Structuring of Stressed Assets, and the Corporate Debt Restructuring Scheme, will be withdrawn with immediate effect
