Finance Minister Nirmala Sitharaman today announced the creation of National Asset Reconstruction Company Limited (NARCL). NARCL is going to be backed by government guarantee of Rs 30,600 crore
Important announcements from the press conference:
1. Finance Minister Nirmala Sitharaman: Union Cabinet yesterday approved Central Government guarantee up to Rs 30,600 Crore to back Security Receipts to be issued by National Asset Reconstruction Company Limited (NARCL)
2. Finance Minister Nirmala Sitharaman: NARCL is already been incorporated, license in process, cabinet approval has come
3. Finance Minister Nirmala Sitharaman: Along with NARCL, we are also setting up an India Debt Resolution Company Limited. PSBs will have 51% ownership in NARCL, while PSBs and public financial institutions will have a maximum of 49% stake
4. Financial Services Secretary: Debt Resolution Company Limited has also been incorporated, company is in place now like NARCL
5. Finance Minister Nirmala Sitharaman: 15% cash payment to be made to banks for NPAs based on some valuation, 85% to be given as Security Receipts For Security Receipts to have their value in tact
6. Finance Minister Nirmala Sitharaman: Many ARCs are there in the private sector but they hesitate to take big-ticket asset resolutions that is why government-backed security receipts are required
7. Finance Minister Nirmala Sitharaman: PSBs are not only making profits, now but also raising money from markets. A total of Rs 58,697 crore has been raised by them so far; both in debt and equity
