Delhi HC seeks Centre, RBI & SEBI response on Subramanian Swamy's plea on Yes Bank

by IANS |

New Delhi, March 17 (IANS) The Delhi High Court on Friday sought response of the Centre, Reserve Bank of India (RBI) and Securities Exchange Board of India (SEBI) on former Rajya Sabha MP Subramanian Swamy's plea seeking investigation by experts' committee into the transfer of Yes Bank's stressed assets to J.C. Flowers Asset Reconstruction Company.

A division bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad also asked Yes Bank and the asset reconstruction company to respond. However, no formal notice was issued in the matter.

Filed as a PIL, Swamy has also sought direction from the Centre, RBI and SEBI to formulate proper and comprehensive guidelines in view of recommendations of the committee to check similar agreements or transactions in future.

A stress asset portfolio of Rs 48,000 crore was transferred from Yes Bank to J.C. Flowers Asset Reconstruction Company.

"This transfer is linked to another deal in which Respondent No.4 (Yes Bank) has obtained a stake of up to 19.9 per cent in the company of Respondent No. 5. (Asset Reconstruction Company)," the PIL states.

In the petition, Swamy claims that the private banking business is suffering from a "growing rot" that has been accelerated by the "perpetual decay" of corporate governance and moral standards in the private banking and asset reconstruction industries.

"This is a growing case of concern as there is apparent conflict of interest between the functioning of banks & ARCs. The situation is further complicated, when motivated and mala fide transactions between the two are allowed to stand as the regulator (RBI), fails to act & enforce its own guidelines causing significant loss of public monies," the petition states.

Non-Performing Assets (NPAs) are a major worry for private sector banks in India, according to Swamy. He claims that ineffective internal controls and weak credit risk management practices are to blame for the high levels of NPAs in these banks.

"The transfer of a distressed asset portfolio worth Rs 48,000 crore to Respondent No.5 (asset reconstruction company) through these transactions appears to be a blatant attempt to circumvent laws and regulations in favour of Respondent No. 5. This not only undermines the trust of the public in the banking sector but also jeopardizes the economic stability of the country. It is alarming to see how Respondent No. 4 (Yes Bank) is willing to sacrifice the recovery of public funds for the benefit of one company," the PIL adds.

Latest News
One killed in Texas wildfire Thu, Feb 29, 2024, 04:46 PM
Cabinet approves royalty rates for 12 critical minerals Thu, Feb 29, 2024, 04:45 PM
UP to have fire stations at tehsil level: Yogi Thu, Feb 29, 2024, 04:44 PM
India's leopard population rises to 13,874: report Thu, Feb 29, 2024, 04:43 PM
4.9-magnitude quake jolts Japan Thu, Feb 29, 2024, 04:23 PM
Cabinet approves chip fab plant by Tata Group & Taiwan's PSMC in Gujarat Thu, Feb 29, 2024, 04:16 PM
Pro-Pak slogan case: Seven interrogated & statements recorded, says Ktaka CM Thu, Feb 29, 2024, 04:15 PM
SC reverses 2018 ruling regarding automatic vacation of stay orders Thu, Feb 29, 2024, 04:14 PM
Scientists finds more evidence on Covid's effect on cognition, memory Thu, Feb 29, 2024, 04:14 PM
India-Mauritius relationship example of SAGAR goodwill: S. Jaishankar Thu, Feb 29, 2024, 04:11 PM
Sports ministry tells NSFs to issue certificates to athletes only through DigiLocker for greater transparency Thu, Feb 29, 2024, 03:59 PM
KL Rahul ruled out of Dharamshala Test; Bumrah returns: BCCI Thu, Feb 29, 2024, 03:55 PM
India received Rs 2.5 lakh crore worth investment proposals in chip sector: Centre Thu, Feb 29, 2024, 03:48 PM
With Rs 50,000 crore investment, UP's real estate sector set for a boom Thu, Feb 29, 2024, 03:46 PM
2010 Silda camp attack: 10 convicted Maoists sentenced to life imprisonment Thu, Feb 29, 2024, 03:46 PM