What is a Bankruptcy remote?
A bankruptcy remote entity is a special-purpose vehicle (“SPV”) that is formed to hold a defined group of assets and to protect them from being administered as property of a bankruptcy estate. The corporate documents of bankruptcy remote like memorandum association and article association may also attempt to create disablements to a bankruptcy filing. For…
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Explained: Insolvency Resolution Process for Corporate Persons regulation 2020: Fourth amendment to IBBI 2016
The Insolvency and Bankruptcy Board of India (IBBI) notified the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Fourth Amendment) Regulations, 2020 on August 7, 2020. As per the latest amendment, which is effective from 07th August 2020, the authorized representative of creditors shall seek voting instructions only after the circulation…
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Understanding the proceedings against large Corporates under IBC
Following the ordinance empowering RBI to lay down the process of initiating steps under the Insolvency and Bankruptcy Code (IBC), an Internal Advisory Committee (IAC) is set up by RBI to oversee the specific steps that are initiated by bankers for resolution of a bad debt. In its first meeting on June 12, 2017, the…
Read articleRBI Guidelines on the Restructuring of Advances by Banks
The Reserve Bank of India (RBI) issued comprehensive guidelines to enable the restructuring of advances by banks in response to the financial distress caused by the COVID-19 pandemic. These guidelines allow for a one-time modification of loan terms for eligible borrowers without necessitating a downgrade in asset classification, provided that specific regulatory conditions are met.…
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Personal guarantors to corporate debtors comes under IBC regime
On Friday (15th November 2019), the Ministry of Corporate affairs notified “Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019”. [WAS PUBLISHED IN THE GAZETTE OF INDIA, PART II, SECTION 3, SUBSECTION (i)]. The new rule called in short as “Insolvency and Bankruptcy rule 2019” shall come into…
Strategic Options Available to Banks for the Resolution of Stressed Assets
Stressed assets, primarily comprising non-performing loans (NPLs), represent a significant challenge for banks and financial institutions. Effective resolution of such assets is crucial to preserving financial stability, optimizing asset quality, and ensuring capital adequacy. To this end, banks employ a range of recovery strategies, including debt restructuring, asset reconstruction, legal proceedings, and one-time settlements, among…
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