About:
- The Committee was chaired by Dr. Harsh Vardhan, Senior Advisor, Bain & Co.
- The Terms of Reference of the Committee were to review the existing state of mortgage securitisation market in India and make recommendations to address various issues relating to originators/investors as well as market microstructure.
The key recommendations of the Committee are as follows:
- setting up of a government sponsored intermediary, through the National Housing Bank, to enable market making and standard setting;
- developing standards for loan origination, loan servicing, loan documentation, and loans to be eligible for securitisation, including standardised formats for data collection and aggregation;
- separation of regulatory guidelines for direct assignment transactions and transactions involving pass through certificates as well as for mortgage backed securities (MBS) and asset backed securities (ABS);
- relaxation of regulatory norms for minimum holding period (MHP) and minimum retention requirement (MRR) for mortgage backed securities (MBS);
- amendments for registration and stamp duty requirements and tax guidelines to reduce the transaction costs for securitisation;
- treating the assets underlying a securitisation transaction as bankruptcy remote under the insolvency laws for financial firms;
