Question

Which of the following statement(s) is/are correct about Asset Reconstruction Companies?
1. ARCs are regulated by SEBI.
2. They are the specialized agencies with a main role of resolving the stressed assets of the Indian banking system.
3. They are involved in buying bad loans from Indian banks to turn them around.
Correct answer code is

• A. Only 1 and 2
• B. Only 2 and 3
• C. Only 1 and 3
• D. All of the above

Answer 1

The correct option is B Only 2 and 3

ARCs are regulated by RBI, and not SEBI.
Asset Reconstruction companies (ARCs):
ARC is a company registered under Section 3 of the Securitization and reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002. The main advantage of ARCs is they help the banks to concentrate on normal banking operations rather than dealing with stressed assets.