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    Question

    What do Asset Reconstruction Companies do with financial

    assets?
    A Convert them into securities Correct Answer Incorrect Answer
    B Sell them in the market Correct Answer Incorrect Answer
    C Write them off Correct Answer Incorrect Answer
    D Provision them as per IRAC norms Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    Asset reconstruction companies (ARC) is a special type of financial institution that buys the Non-Performing Assets (NPAs) or bad assets from banks and financial institutions and work to recover the loans from the bad assets/NPAs bought. ARCs can acquire secured assets from banks by paying in cash or by issuing securities called security receipts (SRs).

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