The Reserve Bank of India (RBI) constituted a committee to review the existing state of mortgage securitisation in India and suggest measures to deepen it.
a. NITI Aayog
b. Bankers Association of India
c. Ministry of Finance
d. Reserve Bank of India
- The six-member committee on Development of Housing Finance Securitisation Market is headed by Harsh Vardhan, Senior Advisor, Bain & Co.
Role of the Panel:
- The panel will review the regulations relating to mortgage-backed securitisation (MBS) currently in place, and make specific recommendations on suitably aligning the same with international norms.
- It will assess the role of various counterparties, including servicers, trustees, rating agencies, in the securitisation process and suggest the steps required.
Mortgage-Backed Security (MBS):
- Mortgage-Backed security (MBS) is a type of asset-backed security that is secured by a mortgage or collection of mortgages.
Mortgage-Backed Securitisation (MBS) in India:
- Data from rating company ICRA showed that the securitisation volume in FY19 more than doubled as against FY18 to Rs.2 lakh crore, of which major chunk of loans sold was by housing finance companies (HFCs) to banks in order to raise funds owing to tough liquidity conditions.
- The mortgage securitisation market in India is primarily dominated by direct assignments among a limited set of market participants on account of various structural factors impacting both the demand and the supply side, as well as certain prudential, legal and tax and accounting issues.
Question:
Q. Who has constituted a six-member committee on Development of Housing Finance Securitisation Market in India?a. NITI Aayog
b. Bankers Association of India
c. Ministry of Finance
d. Reserve Bank of India
