Rbi Circular News Today : Breaking News, Live Updates & Top Stories | Vimarsana

The National Company Law Appellate Tribunal (NCLAT) has dismissed all three applications by SBI against the liquidation value of IL&FS Tamil Nadu Power Company Ltd (ITPCL) provided by the debt-ridden firm's lead banker PNB. The tribunal found no error in fixing the liquidation value as of 30.09.2018, as per the RBI circular. Over 90% of lenders by value and 75% by numbers have already approved the ITPCL restructuring plan.

Unlike the earlier circular, which provided that in case of exposure to AIFs with subordinate units, the entire provisioning may have to be made to Tier 1 entirely. It has now been clarified that it should be done equally across Tier 1 and Tier 2. This should help dilute the harsh effect of such provisioning for REs to an extent since Tier 1 capital is dear for various reasons.

RBI has reviewed the directions on commercial papers (CPs) and non-convertible debentures (NCDs) for initial maturity up to one year. A master direction has been issued accordingly. It will come into effect on April 1, 2024.

While RBI's concerns with respect to evergreening are valid, the circular in its current form will cause discomfort to genuine REs as well as pose certain practical difficulties.

A savings/ current account will be treated as inoperative if there are no customer induced transactions in the account for a period of over two years, reads the RBI notification.