Business Standard

RBI constitutes task force on secondary market for corporate loans

The task force would design the market structure for loan sales/auctions

Reserve Bank of India

FILE PHOTO: A security personnel member stands guard at the entrance of the Reserve Bank of India (RBI) headquarters in Mumbai | Photo: Reuters

Anup Roy Mumbai
The Reserve Bank of India (RBI) on Wednesday constituted a task force on the development of secondary market for corporate loans.

In India, banks sell their stressed loans to the asset reconstruction companies, but has practically no other alternatives. However, globally, there is a healthy corporate loan market where banks can offload their stressed assets and those get traded. Credit Default Swaps (CDS) against these loans also get developed as a result.

“A vibrant, deep and liquid secondary market for debt would go a long way in increasing the efficiencies of the debt market in general and would aid in resolution of

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First Published: May 30 2019 | 2:10 AM IST

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