For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

RBI hikes FDI cap in Asset Reconstruction Companies to 74%

By Super
|
RBI hikes FDI cap in Asset Reconstruction Companies to 74%
New Delhi: The Reserve Bank on Monday hiked the limit for foreign investment in Asset Reconstruction Companies (ARCs) to 74 percent from the earlier cap of 49 percent.
 

"The ceiling for FDI in ARCs has been increased from 49 percent to 74 percent subject to the condition that no sponsor may hold more than 50 percent of the shareholding in an ARC either by way of FDI or by routing through an FII," the RBI said in a notification.

The foreign investment limit of 74 percent in ARC would be a combined limit of FDI and FII.

"The prohibition on investment by FII in ARCs will be removed. The total shareholding of an individual FII shall not exceed 10 percent of the total paid-up capital," the RBI said.

The RBI notification follows Cabinet decision earlier this month to liberalise Foreign Direct Investment (FDI) norms in various sectors.

Further, the RBI also allowed foreign institutional investors (FIIs) to invest in Security Receipts (SRs) up to 74 percent of each tranche of scheme of SRs issued by the ARC.

"The individual limit of 10 percent for investment of a single FII in each tranche of SRs issued by ARCs may be dispensed with. Such investment should be within the FII limit on corporate bonds prescribed from time to time, and sectoral caps under the extant FDI Regulations should be complied with," it said.

PTI

Story first published: Tuesday, August 20, 2013, 9:42 [IST]
Company Search
Enter the first few characters of the company's name or the NSE symbol or BSE code and click 'Go'

Find IFSC

We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more