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What are the circumstances under which the RBI may cancel the Certificate of Registration granted to an asset reconstruction company?
  • a)
    Ceases to receive or hold any investment from a qualified buyer
  • b)
    Ceases to carry on the business of securitization or asset reconstruction
  • c)
    Failed to comply with any conditions subject to which the certificate of registration has been granted
  • d)
    All the above
  • e)
    Either of the above
Correct answer is option 'E'. Can you explain this answer?
Most Upvoted Answer
What are the circumstances under which the RBI may cancel the Certific...
The Reserve Bank of India (RBI) may cancel the Certificate of Registration granted to an asset reconstruction company (ARC) under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002 if either of the following circumstances occur:
a. Ceases to receive or hold any investment from a qualified buyer: An ARC must continuously receive or hold investments from qualified buyers to carry out its business activities. If an ARC ceases to receive or hold such investments, the RBI may cancel its Certificate of Registration.
b. Ceases to carry on the business of securitization or asset reconstruction: The primary purpose of an ARC is to engage in the securitization or asset reconstruction of financial assets. If an ARC discontinues or ceases to carry on this business activity, the RBI may cancel its Certificate of Registration.
c. Failed to comply with any conditions subject to which the certificate of registration has been granted: When the RBI grants a Certificate of Registration to an ARC, it may impose certain conditions that the ARC must comply with. If the ARC fails to meet any of these conditions, the RBI has the authority to cancel its Certificate of Registration.
Therefore, any one of the above circumstances can lead to the cancellation of an ARC's Certificate of Registration by the RBI.
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What are the circumstances under which the RBI may cancel the Certificate of Registration granted to an asset reconstruction company?a)Ceases to receive or hold any investment from a qualified buyerb)Ceases to carry on the business of securitization or asset reconstructionc)Failed to comply with any conditions subject to which the certificate of registration has been grantedd)All the abovee)Either of the aboveCorrect answer is option 'E'. Can you explain this answer?
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What are the circumstances under which the RBI may cancel the Certificate of Registration granted to an asset reconstruction company?a)Ceases to receive or hold any investment from a qualified buyerb)Ceases to carry on the business of securitization or asset reconstructionc)Failed to comply with any conditions subject to which the certificate of registration has been grantedd)All the abovee)Either of the aboveCorrect answer is option 'E'. Can you explain this answer? for Banking Exams 2024 is part of Banking Exams preparation. The Question and answers have been prepared according to the Banking Exams exam syllabus. Information about What are the circumstances under which the RBI may cancel the Certificate of Registration granted to an asset reconstruction company?a)Ceases to receive or hold any investment from a qualified buyerb)Ceases to carry on the business of securitization or asset reconstructionc)Failed to comply with any conditions subject to which the certificate of registration has been grantedd)All the abovee)Either of the aboveCorrect answer is option 'E'. Can you explain this answer? covers all topics & solutions for Banking Exams 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What are the circumstances under which the RBI may cancel the Certificate of Registration granted to an asset reconstruction company?a)Ceases to receive or hold any investment from a qualified buyerb)Ceases to carry on the business of securitization or asset reconstructionc)Failed to comply with any conditions subject to which the certificate of registration has been grantedd)All the abovee)Either of the aboveCorrect answer is option 'E'. Can you explain this answer?.
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