You are here: Home » Finance » News » Banks
Business Standard

New Bill empowers RBI to direct banks to resolve NPAs, appoint advisors

NPAs have risen over Rs 9 lakh crore, RBI can now refer cases to Insolvency and Bankruptcy Board

Press Trust of India  |  New Delhi 

Finance Minister Arun Jaitley
Finance Minister Arun Jaitley

A bill to authorise the to direct companies to resolve the problem of stressed assets was on Monday introduced in the by Minister

The Regulation (Amendment) Bill, 2017, seeks to amend the Regulation Act, 1949 and replace the Regulation (Amendment) Ordinance, 2017, which was promulgated in May this year.


The measure allows the to initiate insolvency resolution process on specific stressed assets.

The would also be empowered to issue other directions for resolution, appoint or approve for appointment, authorities or committees to advise the companies for stressed asset resolution.

Jaitley introduced the Bill amid protests in the House by opposition members protesting over the alleged incidents of lynching by cow vigilantes in different parts of the country.

Just before the bill was introduced, member Sougata Ray said he was opposed to the regulation ordinance and said it was a "desperate step by a desperate government".

Non-performing assets of have risen to over Rs 9 lakh crore and now is being given power to refer the cases to Insolvency and Bankruptcy Board, he said.

"It is the same which had not been able to count notes (since demonetisation). Giving such powers to will detract it from macro-economic to micro-economic issues and render the bank management useless," Roy said

He demanded that the bill be referred to the Parliamentary Standing Committee.

When Speaker Sumitra Mahajan asked Jaitley if he has to say anything on Roy's remarks, the Minister said the issues does not relate to the introduction and would be dealt with when the bill comes up for a discussion.

Moving on fast-track, the had in June identified 12 large loan defaulters who account for 25 per cent of the total bad loans in the sector.

Action under the Insolvency and Bankruptcy Code has already begun in certain cases, including Essar Steel, Bhushan Steel and Bhushan Power & Steel.

First Published: Mon, July 24 2017. 14:50 IST
RECOMMENDED FOR YOU