📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!
  • google app store apple app store
    • ✖

      Question

      According to the IRAC Norms, a loan where the borrower

      has defaulted on payment for over 12 months is classified as _________
      A SMA 1 Asset Correct Answer Incorrect Answer
      B SMA 2 Asset Correct Answer Incorrect Answer
      C Substandard Assets Correct Answer Incorrect Answer
      D Doubtful Assets Correct Answer Incorrect Answer
      E Loss Asset Correct Answer Incorrect Answer

      Solution

      Under IRAC norms , Non performing assets can be further categorized as:  

      • Sub Standard Assets - An asset which has remained NPA for a period less than or equal to 12 months  
      • Doubtful Assets - An asset which has remained in the substandard category for a period of 12 months.  
      • Loss assets - Identification of loss by bank, or internal/external auditor, or RBI ; Asset not written off wholly ; Asset is considered uncollectible and its continuance as a bankable asset is not warranted but may have some salvage and recovery value .  

      Practice Next
      More Alternate Sources of Finance Questions

      Relevant for Exams:

      ask-question