RBI superseded Aviom India management, set to begin insolvency process

RBI has taken similar action in recent past against Yes Bank but did not send it the nclt instead got the leading lenders like SBI, HDFC, ICICI and others to chip and bail it out in March 2020.
 Aviom India Housing Finance
Aviom India Housing FinancePhoto | Facebook
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MUMBAI: Citing significant governance lapses and repeated defaults in payment obligations, the Reserve Bank of India has superseded the current management and board of mid-tier home loan company Aviom India Housing Finance. It has appointed Ram Kumar, former Chief General Manager of Punjab National Bank, as the administrator. The RBI has also announced plans to initiate the insolvency and bankruptcy process soon.

In a statement issued on Monday, the regulator stated that the action was taken based on the recommendation of the National Housing Bank, the sectoral regulator, and in accordance with the powers granted under Section 45-IE(1) of the RBI Act. The statement further noted that the RBI intends to soon initiate the resolution process for the company under the Insolvency and Bankruptcy Code. It added that the regulator would approach the New Delhi bench of the NCLT for the appointment of an administrator and a resolution professional.

RBI has taken similar action in recent past against Yes Bank but did not send it the nclt instead got the leading lenders like SBI, HDFC, ICICI and others to chip and bail it out in March 2020.

A few months similar action was taken against leading cooperative bank PMC Bank and again bailed out by asking the centrum group run Unity Small Finance Bank to bail it out. Other non-bank lenders like DhFl and Reliance Capital were resolved through the NcLt but IL&FS was handled by the government directly through a new board led by commercial banker Uday Kotak.

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