The Reserve Bank of India intends to set up what is described as a financial sector resolution corporation. Announcing this while addressing a banking conclave in Mumbai, N.S. Vishwanathan, deputy governor, said the central bank has discussed this with the government, including the shape the corporation. Its purpose is to not only provide insurance to financial companies but also to provide resolution, he added. Vishwanathan said while non-financial sector companies had the Insolvency and Bankruptcy Code (IBC) to deal with resolution, the proposed corporation is likely to help protect financial sector companies. The government had in September 2016 set up a panel to create a draft law on financial sector resolution. The draft had suggested setting up a corporation to manage resolution.
