Insolvency and Bankruptcy Code, 2016. The Corporate Insolvency Resolution Process of a financial services provider (FSP) will be initiated only on an application by the appropriate regulator,
However, the special framework under section 227 of the Insolvency and Bankruptcy Code, 2016 shall not apply to banks.
Once the application to that effect is admitted, the adjudicating authority is required to appoint an administrator. The administrator shall have the same responsibilities and powers as that of an insolvency professional (IP), the government.
The regulator may form a panel to advise the administrator in operations of the financial services provider during the insolvency resolution process (IRP).
The report also noted that the administrator shall take control of third party assets in possession of the financial services provider (FSP).
The provision of moratorium would not be applicable to third party assets in custody of the financial services provider, and the its license and registration would not be suspended/cancelled during interim-moratorium and during the proceedings of the CIRP.