38. Cover for public deposits – creation of floating charge on Liquid Assets
In order to ensure protection of depositors interest, non-banking financial company shall ensure that at all times there is full cover available for public deposits accepted by it.
(1) While calculating this cover the value of all debentures (secured and unsecured) and outside liabilities other than the aggregate liabilities to depositors shall be deducted from the total assets. Further, the assets should be evaluated at their book value or realizable / market value whichever is lower for this purpose. It shall be incumbent upon the non-banking financial company concerned to inform the Regional Office of the Bank wherein it is registered, in case the asset cover calculated as above falls short of the liability on account of public deposits. Non-banking financial companies accepting / holding public deposits shall create a floating charge on the statutory liquid assets invested in terms of section 45-IB of the Act, in favour of their depositors. Such charge shall be duly registered in accordance with the requirements of the Companies Act, 1956.
(2) Non-banking financial companies shall create the floating charge on the statutory liquid assets maintained in terms of section 45-IB of the RBI Act and in terms of notifications issued by the Bank from time to time, in favour of their depositors through the mechanism of ‘Trust Deed’.The charge is required to be registered with the Registrar of Companies and the information in this regard is required to be furnished to the trustees and the Bank. A copy of the ‘Draft Trust Deed’ containing the details in this regard is enclosed as Annex II for the guidance of the non-banking financial companies. The ‘Trustee Guidelines’ are also enclosed as Annex III.
