The Reserve Bank of India (RBI) on October 11, 2022, issued a notification regarding the review of the Regulatory Framework for Asset Reconstruction Companies (ARCs).
The ARCs play a vital role in the management of distressed financial assets of banks and financial institutions. Considering their critical role, a need was felt to review their functioning and operating framework. Accordingly, as part of the Statement on Developmental and Regulatory Policies released along with the Monetary Policy Statement on April 7, 2021, the Reserve Bank of India set up a committee to undertake a comprehensive review of the working of ARCs and recommend suitable measures for enabling them to function in a more transparent and efficient manner.
The extant regulatory framework for ARCs has been amended as detailed in the Annexure.
These guidelines will come into effect immediately.
[Notification No. RBI/2022-23/128 DoR.SIG.FIN.REC.75/26.03.001/2022-23]
