The Reserve Bank of India has lifted restrictions on two Edelweiss group companies
The Reserve Bank on Tuesday announced that restrictions placed on two entities of the Edelweiss Group have been lifted.
Restrictions on ECL Finance and Edelweiss Asset Reconstruction Company have been lifted after both entities took necessary corrective measures and committed to comply with regulatory guidelines on an ongoing basis, according to a statement.
The restrictions were imposed on May 29 this year, when ECL was ordered to cease and desist from making any scheduled transactions in relation to its wholesale exposure, except for payments and/or closing accounts during its normal business hours.
In the case of another company, ARC was ordered to cease and desist acquisition of financial assets, including security receipts (SRs) and to reclassify existing SRs into senior and subordinated classes.
“The companies have discussed with the Reserve Bank measures to correct the administrative problems,” the statement said.
The RBI lifted the restrictions as it was satisfied based on the submissions and corrective measures put in place by the two organizations to address the central bank’s concerns, it added.
The restrictions were imposed under the provisions of the State Bank of India Act, 1934 and the Security and Reconstruction of Financial Assets and Security Interest Enforcement Act, 2002 (SARFAESI).
Shares of Edelweiss Financial Services closed up nearly 8 percent at Rs 138.80 apiece on the BSE on Tuesday against a 1.30 percent correction in the benchmark.
