To ensure that the originators do not compromise on due diligence of assets generated for the purpose of securitisation, it has been recently decided to stipulate a minimum lock-in period of one year for bank loans before these are securitised.
It has also been proposed to lay down minimum retention criteria for the originators at 10 per cent of the pool of assets being securitised as another measure to achieve the same objective. Addressing regulatory gaps: NCDs and private pools of capital 45. An area of regulatory gap identified was issuance of Non Convertible Debentures (NCDs) of maturity of less than one year.