RBI supersedes Reliance Capital board the firm to go for insolvency soon

The Reserve Bank of India (RBI) on November 30th, 2021, superseded the board of industrialist Anil Ambani-promoted Reliance Capital, a non-banking financial company (NBFC), owing to defaults and governance issues. The data with Bloomberg showed as of date, Reliance Capital had defaulted on Rs 8,3138.8 crore. The company had said in its December-quarter earnings last year that it had listed non-convertible debentures (NCD) of Rs 14,827 crore.

The debt of Reliance Capital stands at Rs 27,100 crore. On a standalone basis, the network was a negative Rs 8,195 crore, and on a consolidated basis a negative Rs 13,700 crore. Reliance Capital reported a consolidated net loss of Rs 2,162 crore in the first half of the financial year (ended September 30).

The RBI has appointed Nageswar Rao Y, former executive director of Bank of Maharashtra, administrator of Reliance Capital. The central bank said it would “shortly initiate the process of resolution of the company under the Insolvency and Bankruptcy … Rules, 2019”. The central bank will also apply to the National Company Law Tribunal (NCLT), Mumbai, for appointing the administrator insolvency resolution professional.

Source: Business Standard