ISLAMABAD:  Securities and Exchange Commission of Pakistan (SECP) notified amendments in Corporate Restructuring Companies (CRCs) Rules, 2019. Amendments made in light of promulgation of Corporate Restructuring Companies Act 2021, are aimed at fostering conducive environment for corporate restructuring companies, an SECP news release said.

Corporate restructuring companies specialise in acquiring nonperforming assets (NPA) from distressed financial institutions, leveraging their expertise to efficiently manage and recover same.

CRC sector plays key role in minimising stressed assets in banking sector through market-led solutions, easing balance sheet burdens and enhancing economic stability. Subject rules have been amended in consultations with State Bank of Pakistan, International Finance Corporation and public at large.

Notable amended provisions include establishment of trusts, comprehensive procedures for liquidation of trusts by CRCs, provisions pertaining to Corporate Restructuring Board (CRB) encompassing its composition, processing/approval of schemes being presented by CRCs, appointment matters, governance and code of conduct, functions and budgetary allocation for operational efficacy.

 “Simultaneously, CRB amendments aim to simplify regulatory approval process for scheme for arrangement. In essence, notified amendments are poised to notably improve rehabilitation process for distressed entities, offering greater opportunities for companies to restructure and restore profitability, ultimately fostering enhanced economic stability,” news release said.

Published in The Daily National Courier, March, 08 2024

Like Business on Facebook, follow @DailyNCourier on Twitter to stay informed and join in the conversation.