Insolvency: Govt may come up with new law for registered valuers
Of the 40 largest NPA accounts sent to various NCLTs, only seven were resolved so far
Mumbai: The government plans to come up with a separate legislation for registered valuers who can help arrive at better valuation of bankrupt companies under the insolvency process, Corporate Affairs Secretary Injeti Srinivas said on Saturday.
Of the 40 largest NPA accounts sent to various National Company Law Tribunals (NCLTs) since last July, which together constitute around 40% of over Rs 11 trillion worth of bad loans, only seven had been resolved so far, where the banks took an average haircut of over 60% since some accounts such as Alok Industries were bid out for only 17% of the money owed to lenders.
Noting that the Insolvency and Bankruptcy Code (IBC) was stabilising, Srinivas said proper valuers were the critical missing link in the process since most insolvency professionals were poorly equipped since it was a new area for them. “You have registered valuers now. But you do not have a separate law for them. We are looking at the possibility of a separate law, say for chartered accountants, or company secretaries. We are assessing whether we can have a full- fledged law to regulate them as they are most critical in the success of the insolvency process.”
At the same event organised by industry chamber CII, MS Sahoo, chairman, Insolvency and Bankruptcy Board of India, said there was a critical role for registered valuers in the whole process.
Editor's Picks »
- 5 issues that’ll dominate RBI board meeting tomorrow
- Future Retail’s Q2 result shows improvement in same-store sales
- Private insurance firms grow at the expense of LIC stuck with a sick bank
- Page Industries’s lofty valuations get a reality check in Q2
- Q2 results: Grasim’s Vodafone Idea stake is proving costly