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    • Question

      A term loan of ₹70 crore is classified as Doubtful.

      Realisable value of primary security is ₹40 crore and collateral security is ₹10 crore. The balance exposure is unsecured. What is the minimum provisioning implication?
      A 25% on entire amount Correct Answer Incorrect Answer
      B 40% on entire amount Correct Answer Incorrect Answer
      C 100% on unsecured portion only Correct Answer Incorrect Answer
      D 100% on secured portion only Correct Answer Incorrect Answer
      E No provision required Correct Answer Incorrect Answer

      Solution

      For doubtful assets, unsecured portion = 100% provision.

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