Context:
The Finance Ministry on Thursday asked banks to closely monitor cases in NARCL and NCLT to minimise procedural delays and adjournments so that bad loan resolution matters are expedited.
Highlights:
- Finance Ministry instructs banks to closely track cases concerning National Company Law Tribunal (NCLT) and National Asset Reconstruction Company Limited (NARCL).
- Aim:
- Avoiding delays in procedures and adjournments for the quick resolution of stressed assets.
- Initiative of the Ministry of Corporate Affairs for the development of a portal which will facilitate easy and transparent information sharing between banks relating to NCLT cases.
- NARCL, which is India’s first bad bank, aims at resolving and liquidating big-value bad loans, through a structured process.
- A bad bank is a financial institution that buys risky assets from other banks or financial organizations to help clean up their balance sheets. Bad banks can be established by banks, governments, or other institutions
- NARCL aggregates and purchases NPAs from banks, while IDRCL deals with the resolution process.
- NARCL has been established as a quasi-judicial body under the Companies Act, 2013 with the main function dealing with corporate disputes of civil nature and is in operation from June 01, 2016.
NCLT is a quasi-judicial authority incorporated for dealing with corporate disputes that are of civil nature arising under the Companies Act. Objectives. Initiated before the Company Law Board under the previous act (the Companies Act 1956)
The National Asset Reconstruction Com
