BANKING AFFAIRS

Detailed explanation-1: -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. Description: Banks are required to classify NPAs further into Substandard, Doubtful and Loss assets.

Detailed explanation-2: -A non-performing asset (NPA) is a classification used by financial institutions for loans and advances on which the principal is past due and on which no interest payments have been made for a period of time.

Detailed explanation-3: -Non-performing assets can include loans, bonds, and other financial instruments, such as mortgages, commercial loans, and credit card debt. The term is most commonly used in the banking and finance industries but can also refer to other investments, such as real estate.

Detailed explanation-4: -The Effects of NPAs Carrying nonperforming assets, also referred to as nonperforming loans, on the balance sheet places three distinct burdens on lenders. The nonpayment of interest or principal reduces cash flow for the lender, which can disrupt budgets and decrease earnings.

Detailed explanation-5: -Devaluated Assets Was this answer helpful?