BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Money at call and short notice.
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An asset that ceases to generate income
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Cash balance in till
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Cash balance with RBI
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Detailed explanation-1: -A non-performing asset (NPA) is a loan or advance in default or in arrears as the principal or interest payment is overdue for 90 days. The RBI, in a 2007 circular said, “An asset becomes non-performing when it ceases to generate income for the bank.”
Detailed explanation-2: -What is Non Performing Assets. Definition: A non performing asset (NPA) is a loan or advance for which the principal or interest payment remained overdue for a period of 90 days.
Detailed explanation-3: -Reserve Bank of India defines NPA as any advance or loan that is overdue for more than 90 days. “An asset becomes non-performing when it ceases to generate income for the bank, ” said RBI in a circular form 2007.
Detailed explanation-4: -A nonperforming asset (NPA) refers to a classification for loans or advances that are in default or in arrears. A loan is in arrears when principal or interest payments are late or missed. A loan is in default when the lender considers the loan agreement to be broken and the debtor is unable to meet his obligations.
Detailed explanation-5: -NPA Question 1 Detailed Solution NPA as defined by the RBI, “if for a period of more than 90 days, the interest or installment amount is overdue then that loan account can be termed as a Non-Performing Asset.