Union Finance Minister Arun Jaitley on 24 July 2017 introduced the Banking Regulation (Amendment) Bill, 2017 in Lok Sabha.
The Banking Regulation (Amendment) Bill, 2017 seeks to amend the Banking Regulation Act, 1949 and replace the Banking Regulation (Amendment) Ordinance, 2017, which was promulgated in May 2017.
Provisions of the Bill
• It authorises the RBI to direct the banking companies to resolve the problem of stressed assets.
• It also allows the RBI to initiate insolvency resolution process on specific stressed assets.
• It empowers RBI to issue other directions for resolution, appoint or approve authorities or committees to advise the banking companies for stressed asset resolution.
• The recovery proceedings will be carried out under the Insolvency and Bankruptcy Code, 2016 that provides for a time-bound process to resolve defaults.
Non-performing assets of banks have risen to over Rs 9 lakh crore and RBI has been given the authority to refer these cases to Insolvency and Bankruptcy Board.
RBI in June 2017 identified 12 large loan defaulters who account for 25 per cent of the total bad loans in the banking sector. The bank already began the action under the Insolvency and Bankruptcy Code in certain cases including Essar Steel, Bhushan Steel and Bhushan Power & Steel.
What: Introduced in Lok Sabha
When: 24 July 2017
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