The Reserve Bank of India (RBI) today removed the business restrictions imposed on Edelweiss Group companies—ECL Finance and Edelweiss Asset Reconstruction Company (ARC).
The central bank barred ECL Finance from undertaking any structured transactions in respect of its wholesale exposures, other than repayment and/ or closure of accounts in its normal course of business, in May this year.
Separately, the regulator directed Edelweiss ARC to stop the fresh acquisition of financial assets, including security receipts (SRs), and reorganise the existing SRs into senior and subordinate tranches.
RBI had imposed the aforementioned restrictions in exercise of its powers under the Reserve Bank of India Act, 1934 and the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI).
Subsequently, the companies engaged with the Reserve Bank on the remedial measures to address the supervisory concerns, according to a central bank statement.
“Now, having satisfied itself based on submissions and remedial measures put in place by these companies to address the concerns of RBI and their commitment to ensure adherence to the Regulatory Guidelines at all times and on an ongoing basis, the Reserve Bank has decided to lift the aforementioned restrictions placed on ECL Finance Limited and Edelweiss Asset Reconstruction Company Limited, with immediate effect,” the RBI said.
