Question

Which is NOT correct about NPA?

1. It is the credit amount for which the principal amount or the interest amount or both the principal amount and the interest amount due is not paid for a specific period of time (generally 90 days)

2. Private sectors banks have more NPAs than public sector banks

3. High NPA reduces the profitability of financial institution

A Only i Correct Answer Incorrect Answer
B Only ii Correct Answer Incorrect Answer
C Only iii Correct Answer Incorrect Answer
D Only i & ii Correct Answer Incorrect Answer
E Only ii & iii Correct Answer Incorrect Answer

Solution

Public sector banks are struggling with increased NPA due to their high exposure to infrastructure sector.

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