The Reserve Bank of India has taken control over the board of Dewan Housing Finance Corp. Ltd (DHFL) and appointed an administrator in its place, citing ‘governance concerns and payment defaults’. It will soon start insolvency proceedings against the non-banking finance company (NBFC).
R. Subramaniakumar, a former managing director and chief executive of Indian Overseas Bank, was named as the administrator for DHFL. With this, DHFL is set to become the first non-bank lender to be referred to the National Company Law Tribunal (NCLT) under new rules notified by the government on 15 November.
RBI said that it would soon initiate the process of resolution of the company under the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 and would apply to the NCLT for appointing the administrator as the insolvency resolution professional.