Date: 23-Jan-2023Category: Extra OrdinaryState: Union GovernmentCountry: India
In exercise of the powers conferred by clause b of sub section 1 of section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act,
The notification issued by the Reserve Bank of India (RBI) amends the regulations concerning Asset Reconstruction Companies (ARCs).
It increases the minimum Net Owned Funds (NOF) requirement for ARCs and removes a specific condition from previous notifications.
Key Changes
The minimum NOF required for new ARCs is increased from Rupees one hundred crore to Rupees three hundred crore, effective immediately.
Existing ARCs must achieve a minimum NOF of Rupees two hundred crore by March 31, 2024, and Rupees three hundred crore by March 31, 2026.
Condition (a) of Notifications DNBR (PD-ARC) No. 07/ ED(SS)-2018 dated May 16, 2018, and DoR. FIN. No. 08/ 26.03.001/ 2020-2021 dated March 10, 2021, is removed with immediate effect.
Impact Analysis
Impact on ARCs
ARCs must review the original notifications (DNBR (PD-ARC) No. 07/ ED(SS)-2018 and DoR. FIN. No. 08/ 26.03.001/ 2020-2021) to fully understand the implications of the removed condition.
Impact on RBI
RBI's supervisory role over ARCs will continue to ensure financial stability and protect the interests of stakeholders.
Impact on Investors/Lenders
Lenders selling assets to ARCs may benefit from dealing with financially stronger entities.
Suggested Action Items
Legal teams: Review the implications of the removal of condition (a) from the specified notifications.
Key Entities Referenced
Reserve Bank of India (RBI): The central bank of India, responsible for regulating the banking sector and other financial institutions, including ARCs.
Asset Reconstruction Companies (ARCs): Companies registered with the RBI under Section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) to acquire and manage non-performing assets (NPAs) from banks and financial institutions.
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act): An Indian law that provides a legal framework for securitization and asset reconstruction, and for the enforcement of security interests.
Net Owned Funds (NOF): The sum of paid-up equity capital and free reserves (including any amount transferred from the profit and loss account) after deducting accumulated losses and intangible assets.
Notification DNBR (PD-ARC) No. 05/ ED(SS)-2017 dated April 28, 2017: RBI notification pertaining to regulations for ARCs which is now amended by this notification.
Notification DNBR (PD-ARC) No. 07/ ED(SS)-2018 dated May 16, 2018: RBI notification pertaining to regulations for ARCs which is now amended by this notification.
Notification DoR. FIN. No. 08/ 26.03.001/ 2020-2021 dated March 10, 2021: RBI notification pertaining to regulations for ARCs which is now amended by this notification.
रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99
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असाधारण
EXTRAORDINARY
भाग III—खण् ड 4
PART III—Section 4
प्राजधकार स ेप्रकाजित
PUBLISHED BY AUTHORITY
स.ं 45] नई ददल्ली, सोमर्ार, िनर्री 23, 2023/माघ 3, 1944
No. 45] NEW DELHI, MONDAY, JANUARY 23, 2023/MAGHA 3, 1944
भारतीय ररज़र् व बकैं
(जर्जनयमन जर्भाग)
केंद्रीय कायालव य, म ंबई
अजधसचू ना
म ंबई, 11 अक् तूबर, 2022
अजधसचू ना सख्ं या जर्जर्. एफआईएन. आरईसी. 75/ ईडी(एसएस)-2022.
I. जर्त्तीय आजस्ट्तयों का प्रजतभूजतकरण और पन गठव न एर्ं प्रजतभूजत जित का प्रर्तवन अजधजनयम, 2002 की धारा 3 की
उप-धारा (1) के खंड (बी) द्वारा प्रदत्त िजियों का प्रयोग करत े हुए, भारतीय ररज़र् व बैंक ददनांक 28 अप्रैल 2017 की
अजधसूचना डीएनबीआर (पीडी-एआरसी) संख्या 05/ इडी(एसएस)-2017 में तत्काल प्रभार् से जनम्नजलजखत संिोधन
करता ि:ै
(i) इस अजधसूचना की जतजथ स,े उि अजधसूचना के पैरा 1 में सौ करोड़ रुपय े को तीन सौ करोड़ रुपय े के साथ
प्रजतस्ट्थाजपत दकया िाएगा।
(ii) उि अजधसूचना के परै ा 2 को जनम्नजलजखत के साथ प्रजतस्ट्थाजपत दकया िाएगा:
“सभी एआरसी, िो पिल े से िी भारतीय ररज़र्व बैंक के साथ पिं ीकृत ि,ैं उन्ि ें 31 माच व 2024 तक दो सौ करोड़ रुपय े
का न्यूनतम एनओएफ और 31 माच व 2026 तक तीन सौ करोड़ रुपय ेका न्यूनतम एनओएफ प्राप्त करना िोगा।”
527 GI/2023 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4]
II. जर्त्तीय आजस्ट्तयों का प्रजतभूजतकरण और पन गठव न एर्ं प्रजतभूजत जित का प्रर्तवन अजधजनयम, 2002 की धारा 2 की
उप-धारा (1) के खंड (यू) के साथ परठत धारा 7 की उप-धारा (1) द्वारा प्रदत्त िजियों का प्रयोग करत े हुए, भारतीय ररज़र्व
बैंक एतद~ द्वारा ददनांक 16 मई 2018 की अजधसूचना डीएनबीआर (पीडी-एआरसी) संख्या 07/ ईडी(एसएस)-2018 और
ददनांक 10 माच व 2021 की अजधसूचना डीओआर. एफआईएन. संख्या. 08/ 26.03.001/ 2020-21 में तत्काल प्रभार् स े
जनम्नजलजखत संिोधन करता ि:ै
(i) उि अजधसूचनाओं की ित व (क) को िटाया िाएगा।
सौरभ जसन्िा, कायवपालक जनदिे क
[जर्ज्ञापन-III/4/असा./571/2022-23]
RESERVE BANK OF INDIA
(Department of Regulation)
(CENTRAL OFFICE, MUMBAI)
NOTIFICATION
Mumbai, the 11th October, 2022
Notification No. DoR. FIN. REC. 75/ ED (SS)-2022.
I. In exercise of the powers conferred by clause (b) of sub-section (1) of section 3 of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, the Reserve Bank of India hereby
makes the following amendments in the Notification DNBR (PD-ARC) No. 05/ ED(SS)-2017 dated April 28, 2017
with immediate effect.
(i) In Paragraph 1 of the said notification, Rupees one hundred crore shall be substituted with Rupees three
hundred crore with effect from the date of this Notification.
(ii) Paragraph 2 of the said notification, shall be substituted with the following:
“All the ARCs, which are already registered with the Reserve Bank of India shall achieve the minimum NOF
level of Rupees two hundred crore latest by March 31, 2024 and Rupee three hundred crore latest by March 31,
2026.”
II. In exercise of the powers conferred by sub-section (1) of section 7 read with clause (u) of sub-section (1) of
section 2 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002,
the Reserve Bank of India hereby makes the following amendment in the Notifications DNBR (PD-ARC) No. 07/
ED(SS)-2018 dated May 16, 2018 and DoR. FIN. No. 08/ 26.03.001/ 2020-2021 dated March 10, 2021 with
immediate effect.
(i) Condition (a) of the said notifications shall be omitted.
SAURAV SINHA, Executive Director
[ADVT.-III/4/Exty./571/2022-23]
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and Published by the Controller of Publications, Delhi-110054.