Which of the following will be classified as Non-Performing Asset-1- A car loan for which interest has been overdue for a period of last 2 months2- A house loan on which the instalment of principle has not been paid for last 6 months-3- Short duration crop agriculture loans if the interest has not been paid since last 90 days-Code-

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Simple Interest & Compound Interest

Which of the ...

Question

Which of the following will be classified as Non-Performing Asset:

Code:

1 only

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2 only

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3 only

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1 and 2 only

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Solution

The correct option is B
2 only

An asset becomes non-performing when it ceases to generate income for the bank

According to RBI, terms loans on which interest or instalment of principal remain overdue for a period of more than 90 days from the end of a particular quarter is called a Non-performing Asset. However, in terms of Agriculture / Farm Loans; the NPA is defined as under: For short duration crop agriculture loans such as paddy, Jowar, Bajra etc. if the loan (instalment / interest) is not paid for 2 crop seasons, it would be termed as a NPA. For Long Duration Crops, the above would be 1 Crop season from the due date.

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Which of the following will be classified as Non-Performing Asset: Code:

Which of the following will be classified as Non-Performing Asset:

Code: