Are you willing to know the detailed information about the Core Investment Companies? Here is the article which provides you clean and clear information about the Core Investment Companies. These Companies have their benefits properly as their investments in shares for holding the stake in group companies but not for trading and these do not carry any other financial activities.
It is a Non-Banking Financial Company which is carrying on the business of addition of shares and securities and which holds not less than 90% of its net assets in the form of the investment in equity shares, preferences shares, bonds, debentures, debts in a group companies and its investments in the equity shares in group companies constituents which is not less than 60% of its net assets on the last audited balance sheets.
CICs were not required to obtain Certificate of Registration from Reserve Bank. Practically, it is very difficult to determine what type of share transaction the CIC is engaging with.
Considering the many associated issues, the RBI has enacted a revised regulatory framework for CICs from 2010 onwards. These are the Features of CIC:-
- It has an asset size of less than Rs100 crore will be exempted from the requirements of registration with RBI. For this purpose, all CICs belonging to a Group will be aggregated.
- CICs with asset size above Rs. 100 crore but not accessing public funds are also exempted from the requirement of registration with RBI.
- Due to systemic implications on account of access to public funds CICs having an asset size of 100 crore or above are categorized as Systemically Important Core Investment and are required to obtain Certificate of Registration from the Reserve Bank.
