Tag: RBI
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Further Measures to Boost Infrastructure Financing
[Posted by Umakanth Varottil] In continuation of previous measures, the Reserve Bank of India (RBI) has taken additional steps to enable financing in the infrastructure sector. First, the proposed introduction of credit default swaps on corporate bonds (discussed here) covers corporate bonds issued by Special Purpose Vehicles (SPV) of rated infrastructure companies “keeping in view…
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RBI Proposes Credit Default Swaps on Corporate Bonds
[Posted by Umakanth Varottil] The Reserve Bank of India (RBI) has issued a draft report that proposes the introduction of credit default swaps (CDS) for corporate bonds. Comments are due on the proposal by October 4, 2010. The move to create a market for CDS in India has been delayed for the last few years…
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Regulating Bankers’ Pay
[Posted by Umakanth Varottil] Consistent with international trends to impose greater regulation on executive compensation in banks, the Reserve Bank of India (RBI) has issued draft guidelines on compensation of whole time directors/ chief executive officers / risk takers and control function staff. This applies to private sector and local area banks and all foreign…
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More on the Pricing Guidelines for Foreign Investment
[Posted by Umakanth Varottil] (The following post is contributed by Raghav Sharma, who is an associate with a law firm in Delhi) This post relates to Mr. Somasekhar Sundaresan’s article titled “RBI cuts sorry figure over norms for share transfers” wherein the author has highlighted certain ambiguities arising from the Reserve Bank of India’s (“RBI”)…
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ECB Process for Infrastructure Finance Eased
[Posted by Umakanth Varottil] The Reserve Bank of India has issued a circular bringing external commercial borrowings (ECBs) by designated Infrastructure Finance Companies (IFCs) within the automatic route subject to certain limits. The relevant portion of the circular is extracted below: On a review of the policy, it has been decided to modify the extant…
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Changes to Minimum Pricing Norms for Transfers of Indian Securities
[Posted by Umakanth Varottil] (In his previous post, Tanmay Amar examined the new base pricing norms for issue of securities by Indian companies to non-resident investors. He now follows it up with an analysis of the new RBI circular, which is hot off the press, that amends pricing norms for transfers of securities between a…
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Core Investment Companies – Draft RBI Guidelines
[Posted by Umakanth Varottil] (The following post has been contributed by Vijay Kumar, a lawyer and a company secretary by qualification, who is practising as an Advocate in the Chennai High Court with the law firm of Iyer and Thomas) Non – Banking Finance Companies have been classified as a. Asset Finance Company b. Investment…
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Changes to Minimum Pricing Norms for FDI in Unlisted Companies
[Posted by Umakanth Varottil] (The following post is from Tanmay Amar, senior associate at Luthra & Luthra. Tanmay discusses a significant change to the minimum pricing norms for issue of shares by Indian companies to foreign investors. This change is bound to affect the manner in which valuations are to be arrived at, especially for…
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Southern Technologies and Sticky Interest – Part II
[Posted by V. Niranjan] We discussed the recent decision of the Supreme Court in Southern Technologies that rejected a challenge to the constitutionality of ss. 36(1)(vii) and 43D of the Income Tax Act, 1961. The Court held that non-banking-financial institutions [“NBFC”] must account as income interest received from loans that are, for commercial purposes, bad…
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Legal Risks and Financial Sector; Capital Controls
[Posted by Umakanth Varottil] Recent developments in the financial sector have witnessed a sea-change in the nature of legal risks faced by banks and financial institutions. Regulators, banks and financial institutions, as well as their legal advisors (both in-house and external) are required to constantly keep pace with the change. In that context, a recent…