The Reserve Bank of India (RBI) has set up a working group to review the regulatory and supervisory framework for core investment companies (CIC).
The group will be headed by Tapan Ray, non-executive chairman, Central Bank of India and former Secretary in the Ministry of Corporate Affairs.
“Over the years, corporate group structures have become more complex, involving multiple layering and leveraging, which has led to greater inter-connectedness with the financial system through their access to public funds,” the RBI said regarding the objective behind forming the panel. “Further, in the light of recent developments, there is a need to strengthen the corporate governance framework of CICs,” itthe RBI said. Troubled financial conglomerate Infrastructure Leasing and Financial Services is registered with the RBI as a CIC.
According to the terms of reference, for the panel will examine the current regulatory framework for CICs in terms of adequacy, efficacy and effectiveness and suggest changes.
The panel will also suggest, among others, measures to strengthen corporate governance and disclosure requirements for CICs and measures to enhance the RBI’s off-sight surveillance and on-site supervision over CICs.