12.
Power of Reserve Bank to determine policy and
issue directions.- (1) If the Reserve
Bank is satisfied that in the public interest
or to regulate financial system of the country
to its advantage or to prevent the affairs of
any securitisation company or reconstruction
company from being conducted in a manner detrimental
to the interest of investors or in any manner
prejudicial to the interest of such securitisation
company or reconstruction companay, it is necessary
or expedient so to do, it may determine the
policy and give directions to all or any securitisation
company or reconstruction company in matters
relating to income recognition, accounting standards,
making provisions for bad and doubtful debts,
capital adequacy based on risk weights for assets
and also relating to deployment of funds by
the securitisation company or reconstruction
company, as the case may be, and such company
shall be bound to follow the policy so determined
and the directions so issued.
(2) Without prejudice to the
generality of the power vested under sub-section
(1), the Reserve Bank may give directions to
any securitisation company or reconstruction
company generally or to a class of securitisation
companies or reconstruction companies or to
any securitisation company or reconstruction
company in particular as to-
(a) the type of financial
asset of a bank or financial institution which
can be acquired and procedure for acquisition
of such assets and valuation thereof;
(b) the aggregate value of
financial assets which may be acquired by any
securitisation company or reconstruction company.
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