What is Core Investment Company?
A Core Investment Company (CIC) is categorized as a Non Banking Financial Company (NBFC) by the Reserve Bank of India (RBI). These companies predominately invest in shares of its own group companies for stakeholding but cannot engage in trading of these instruments or carry out any other kind of financial activity.
What is Core Investment Company?
None of the Core Investment companies can accept deposits. This is one of the basic eligibility criteria of a Core Investment Company. The asset classification norms for CIC's are:-
- Registered CIC’s with assets less than Rs. 100 crore worth follow the norms specified in the Non-Systematically Important NBFC Prudential Norms, 2015.
- For those with assets more than Rs. 100 core follows the norm as specified in Systematically Important NBFC Prudential Norms Directions, 2015.
The Process of Registration of CIC-ND-SI
- The Core Investment Company needs to download the application form for registration from the website of RBI.
- It needs to be filled in and submitted to the Regional Office of DNBS (Department of Non-Banking Supervision) along with the supporting documents as mentioned in the form. The DNBS has to be the one under whose jurisdiction the company is registered.
- The adjusted net worth (ANW) of the CIC-ND-SI cannot be less than 30% of the risk-weighted assets (RWA).
- In situations where the aggregate asset size is calculated, it is required that all the CIC’s within the group need to be registered as individual CIC-ND-SI, the adjusted net worth being applied individually.
The CIC's that are exempted from registration, however, need to pass a Board Resolution that they will not in the future indulge in accessing public funds.
