New RBI Norms on Debt Restructuring

The Reserve Bank of India has notified a ‘Strategic Debt Restructuring Scheme’ as part of its ‘Framework for Revitalization of Distressed Assets in the Economy’. Among other provisions, the scheme allows lenders to acquire a controlling interest in a distressed debtor company and appoint professional management to run the affairs of the company as part of a debt restructuring exercise in appropriate cases. 

This is based on Vidhi’s recommendations in a concept paper submitted to the RBI in October last year as part of our research mandate from the RBI. The Scheme can be accessed here.