The Reserve Bank of India on Tuesday named an advisory committee to advise the Administrator for Reliance Capital, a day after it superseded the board of Anil Ambani's Reliance Group promoted company. On Monday, the central bank had also appointed Nageswar Rao Y (Ex-Executive Director, Bank of Maharashtra) as the administrator of the NBFC.
The members of the advisory committee are as follows:
-Sanjeev Nautiyal, ex-DMD, State Bank of India
-Srinivasan Varadarajan, ex-DMD, Axis Bank
-Praveen P Kadle, ex-MD & CEO, Tata Capital Limited
RBI stated, "In exercise of powers conferred under section 45-IE (5) (a) of the RBI Act 1934, the Reserve Bank has constituted a three-member Advisory Committee to assist the Administrator in discharge of his duties."
"It may also be mentioned that the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 provide for the concerned financial sector regulator appointing a Committee of Advisors to advise the Administrator in the operations of the financial service provider during the corporate insolvency resolution process," RBI further stated.
On Monday, the RBI said the RCL board has been superseded "in view of the defaults by RCL in meeting the various payment obligations to its creditors and serious governance concerns which the Board has not been able to address effectively".
RCL owes Rs 21,781.01 crore, including interest, as on October 31 to lenders. It has also defaulted on repayment of inter-corporate deposits taken from various parties aggregating to Rs 562 crore and interest Rs 120 crore for which maximum days of default ranges from 510 days to 567 days.
RCL made a loss of Rs 10,971 crore on a revenue of Rs 563 crore during the fiscal ended March 2021.
The Reserve Bank will also apply to the NCLT, Mumbai, for appointing the administrator as the Insolvency Resolution Professional.