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      Question

      What is the provision required for the secured portion

      of an asset classified as Substandard Asset according to RBI’s IRAC guidelines?
      A 10% Correct Answer Incorrect Answer
      B 15% Correct Answer Incorrect Answer
      C 20% Correct Answer Incorrect Answer
      D 25% Correct Answer Incorrect Answer
      E 40% Correct Answer Incorrect Answer

      Solution

      When an asset has been classified as NPA for a period of less than or equal to 12 months, it is considered a "Substandard Asset." In case of Sub standard assets, a provision of 15% is to be made if the loan is secured. In case of unsecured loan, the provision requirement is 25%.

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