India's Finance Minister Arun Jaitley has stressed that the government remains committed to protect the interest of financial institutions and depositors. Tweeting on the internet, he wrote, “The Financial Resolution and Deposit Insurance Bill, 2017, is pending before the Standing Committee. The objective of the government is to fully protect the interest of the financial institutions and depositors.” He added that the government stands committed to this objective.
Economic Affairs Secretary SC Garg said the FRDI Bill suggests protecting existing rights of the depositors. “There is no dilution thereof. Instead, it enhances present protections in certain ways. Principal guarantee for PSU Banks' depositors come from government ownership which also remains completely unaffected,” he said. The FRDI remains pending before the standing Committee. The Centre had tabled the FRDI Bill, 2017, in August in the Lok Sabha, seeking to deal with the insolvency of financial service providers. In a statement released to the press, the Finance Ministry clarified the existing provisions of deposit protection guarantee will be maintained in the new bill.
It is said that the bill provides for the establishment of a resolution corporation with powers relating to the transfer of assets to a healthy financial firm, merger or amalgamation, liquidation to be initiated by an order of the National Company Law Tribunal.
