{"id":16905,"date":"2020-09-25T12:52:46","date_gmt":"2020-09-25T07:22:46","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=16905"},"modified":"2020-09-25T12:52:50","modified_gmt":"2020-09-25T07:22:50","slug":"rbi-has-expert-committee-report-on-resolution-framework-for-covid-19-related-stress","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/rbi-has-expert-committee-report-on-resolution-framework-for-covid-19-related-stress\/","title":{"rendered":"RBI has Expert Committee Report on Resolution Framework for COVID-19 Related Stress"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The Reserve Bank of India has the expert committee report\nreleased on Resolution Framework for COVID-19 relates to stress. The Reserve\nBank on August 7, 2020, has announced the constitution of an Expert Committee\nunder the chairmanship of Shri K.V. Kamath in order to make recommendations on\nfinancial parameters. It has made resolution plans under the &#8216;Resolution\nFramework for Covid19-related Stress&#8217; along with sector-specific benchmark\nranges for such parameters. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Recommendations by the Committee to RBI<\/h2>\n\n\n\n<p>The Committee has submitted the report to a Reserve Bank on September\n4, 2020, which is being placed on the RBI website. The Committee has recommended\nfinancial parameters including aspects related to leverage, liquidity and debt\nserviceability. The Committee has also recommended financial ratios for 26\nsectors that could be factored by lending institutions when a resolution plan\ngets finalize for a borrower.<\/p>\n\n\n\n<p>A <strong><em>Reserve Bank of India<\/em><\/strong><sup><a href=\"https:\/\/www.rbi.org.in\/\"><strong><em>[1]<\/em><\/strong><\/a><\/sup> has broadly accepted the recommendations of a Committee. Accordingly, to a circular the Resolution Framework guidelines were announced on August 6, 2020, has now been issued by Reserve Bank of India specifying five specific financial ratios. The specific sector thresholds for each ratio in respect of 26 sectors to be taken into account when the resolution plans were finalized. In respect to other sectors where certain ratios have not been specified, the lenders will make the assessment on their own keeping in view the contours of the circular dated August 6, 2020, and the follow-up circular issued.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/supreme-court-recommends-comprehensive-system-of-advance-tax-ruling-to-reduce-litigation\/\">Supreme Court Recommends Comprehensive System of Advance Tax Ruling to Reduce Litigation<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">RBI has Revised Priority Sector Lending Guidelines<\/h2>\n\n\n\n<p>The Reserve Bank has also revised the priority section\nlending Guidelines. The RBI has comprehensively reviewed the (PSL) Priority\nSector Lending Guidelines to align it with emerging national priorities and\nhave a sharper focus on inclusive development, after having the discussions\nwith all stakeholders.<\/p>\n\n\n\n<p>Revised PSL guidelines will now enable better credit\npenetration to credit deficient area. It increases the lending to small and\nmarginal farmers and weaker sections and also boosts credit to renewable\nenergy, health and infrastructure.<\/p>\n\n\n\n<p>The Bank finance start-ups (up to \u20b950 crores) and provide\nloans to farmers for installing solar power plants for solarisation of a\ngrid-connected agriculture pump. Also, provide loans for setting up (CBG)\nCompressed Bio-Gas plants and has included fresh categories eligible for\nfinance under priority sector. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Features of Revised Priority Sector Lending (PSL) guidelines<\/h3>\n\n\n\n<p><strong><em>Some of the features of revised PSL guidelines are:<\/em><\/strong><\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img decoding=\"async\" width=\"623\" height=\"411\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/09\/image-101.png\" alt=\"Features of Revised Priority Sector Lending (PSL) guidelines\" class=\"wp-image-16906\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/09\/image-101.png 623w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/09\/image-101-300x198.png 300w\" sizes=\"(max-width: 623px) 100vw, 623px\" \/><\/figure><\/div>\n\n\n\n<ul><li>To address regional disparities in a flow of\npriority sector credit, higher weightage assigned to an incremental priority\nsector credit in &#8216;identified districts&#8217; where a priority sector credit flow is\ncomparatively low.&nbsp; <\/li><li>The targets are for &#8220;small and marginal\nfarmers&#8221; and &#8220;weaker sections&#8221; has been increased in a phased\nmanner.<\/li><li>The higher credit limit has specified for (FPOs)\nFarmers Producers Organisations \/ (FPCs) Farmers Producers Companies\nundertaking farming with assured marketing of the produce at the pre-determined\nprice.<\/li><li>The Loan limits for a renewable energy have been\nincreased and is doubled.<\/li><li>For an improvement of health infrastructure, the\ncredit limit for health infrastructure (including under &#8216;Ayushman Bharat\u2019) has\nbeen doubled.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Conclusion<\/h2>\n\n\n\n<p>The Reserve Bank of India released an expert committee report on the &#8216;Resolution Framework for Covid19-related Stress&#8217;.The Committee has recommended financial parameters for leverage, liquidity and debt serviceability. It has also recommended financial ratios for 26 sectors that could be factored by lending institutions. <\/p>\n\n\n\n<p>Also, The Reserve Bank has revised the priority section lending Guidelines. Now, bank can finance start-ups (up to \u20b950 crores) and provide loans to farmers for installing solar power plants and also for setting up (CBG) Compressed Bio-Gas plants. You may please contact our professional for further information or assistance.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/lok-sabha-passes-companies-amendment-bill-2020\/\">Lok Sabha passes Companies (Amendment) Bill, 2020<\/a><\/mark><\/p>\n\n\n<a href=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/09\/Resolution-Framework-for-COVID-19-Related-Stress.pdf\" class=\"pdfemb-viewer\" style=\"\" data-width=\"max\" data-height=\"max\"  data-toolbar=\"bottom\" data-toolbar-fixed=\"off\">Resolution-Framework-for-COVID-19-Related-Stress<br\/><\/a>\n<p class=\"wp-block-pdfemb-pdf-embedder-viewer\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Reserve Bank of India has the expert committee report released on Resolution Framework for COVID-19 relates to stress. The Reserve Bank on August 7, 2020, has announced the constitution of an Expert Committee under the chairmanship of Shri K.V. Kamath in order to make recommendations on financial parameters. It has made resolution plans under [&hellip;]<\/p>\n","protected":false},"author":10,"featured_media":16908,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[153],"tags":[1037],"acf":{"service_id":"410"},"authorName":"Soumya Bajpai","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/01\/0.jpg","authorDescription":"Soumya has done LLB (Hons) and has a 2+years experience in writing. Her main interest is in reading judgments, new enactments and amendments taking around in law. She always strives to bring the best to work that she does.","postViews":3803,"readingTime":3,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/16905"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=16905"}],"version-history":[{"count":6,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/16905\/revisions"}],"predecessor-version":[{"id":16914,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/16905\/revisions\/16914"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/16908"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=16905"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=16905"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=16905"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}