National company law tribunal Current Affairs - 2019
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The merger of Induslnd Bank and Bharat Financial Inclusion Ltd (BFIL) will be effective from 4 July 2019. This decision to file National Company Law Tribunal (NCLT) Order on 4 July, by lender IndusInd , BFIL and IFIL with Registrar of Companies was taken by the boards of IndusInd and BFIL.
Background: In October 2018, IndusInd Bank decided to acquire India’s leading micro-finance player BFIL, earlier known as SKS Microfinance. On 10 June 2019, National Company Law Tribunal (NCLT), a quasi-judicial body in India that adjudicates issues relating to Indian companies, sanctioned Scheme of Arrangement among BFIL, IndusInd and IFIL and their respective shareholders and creditors.
After the merger current CEO of BFIL, M R Rao, will become the CEO of IndusInd Financial Inclusion Ltd (IFIL) and all employees of BFIL will become part of Induslnd family.
The Business Correspondent (BCs) network of BFIL will operate under IFIL.
All Assets and liabilities of BFIL will be merged with IndusInd’s balance sheet.
The consolidated financial results for 1st quarter of FY19 will be published on 12 July 2019.
In accordance with Scheme of Arrangement, BFIL’s shareholders will get 639 shares of bank for every 1,000 they held. The scheme also contemplates a preferential allotment of share warrants to promoters of bank in accordance with scheme, which says that each share warrant, upon exercise, shall entitle Promoters to one Equity share.
Financial Inclusion: This merger of IndusInd Bank Limited and BFIL will enable 8.8 million microfinance customers of BFIL to access savings, deposits and other banking products. Thus the merger will help in boosting financial inclusion in its truest form.
Increase Banking Reach: Also talent, capabilities and distribution of BFIL will enable IndusInd Bank to play a more meaningful role in rural India and will fulfill ambition of building financial inclusiveness and sustainability in large swathes of unbanked and underbanked India.
Tags: Bank Merger • Bharat Financial Inclusion Ltd • IndusInd Financial Inclusion Ltd • Induslnd • Induslnd Bank- BFIL merger
Krishnamurthy Subramanian, Chief Economic Adviser (CEA) and B. Sriram, former managing director (MD) and chief executive officer (CEO) of Industrial Development Bank of India (IDBI Bank) were appointed part-time members of Insolvency and Bankruptcy Board of India (IBBI).
K Subramanian, an Indian School of Business (ISB) Hyderabad professor was appointed chief economic adviser for a period of 3 years in December 2018.
Their appointment was approved by Appointments Committee of the Cabinet (ACC), which is composed of Prime Minister of India (who is Chairman), Union Minister of Home Affairs and the order for appointment was issued by Department of Personnel and Training (DoPT).
About Insolvency and Bankruptcy Board of India
- IBBI, an insolvency regulatory agency was established on 1 October 2016. It was given statutory powers by Insolvency and Bankruptcy Code (IBC), the bankruptcy law of India which was passed by Lok Sabha on 5 May 2016.
- The IBC 2016 established Insolvency and Bankruptcy Board of India (IBBI), to oversee insolvency proceedings in India and to regulate entities registered under it.
- The IBBI Governing Board consists of 10 members, including representatives from the Ministry of Finance (MoF), Ministry of Law and Justice, Ministry of corporate affairs (MCA), and Reserve Bank of India (RBI).
- IBBI act as a regulator for overseeing insolvency proceedings and entities such as Insolvency Professionals (IP), Insolvency Professional Agencies (IPA) and Information Utilities (IU) in India.
- IBC covers Individuals, Companies, Partnership firms and Limited Liability Partnerships and handles cases under it using tribunals namely National company law tribunal (NCLT) and Debt recovery tribunal (DRT).