NRIs can pick shares at face value: RBI

The Reserve Bank of India on Wednesday said that non-residents including NRIs can make investment in an Indian company at the face value of shares or debentures subject to eligibility to invest under the FDI scheme.

Earlier, a person resident outside India may purchase shares or convertible debentures of an Indian company under Foreign Direct Investment Scheme.

RBI said "where non-residents (including NRIs) make investment in an Indian company in compliance with the provisions of the Companies Act, 1956, by way of subscription to Memorandum of Association, such investments may be made at face value subject to their eligibility to invest under the FDI scheme".

Also in another separate circular, RBI said that it will consider the financial restructuring proposals of urban co-operative banks (UCB) for conversion of deposits into equity even if the networth of the bank does not become positive.

This move is considered beneficial as this is considered as an additional option for resolution of banks problem.

GoodReturns.in