% Of Provision Made on NPA In Banking companys A/c
Standard Assets
Sub Standard Assets
Doubtful assets ( Both Secured By Tangible Assets % not )
losses assets
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Non Performing assets
Replies (4)
For Doubtful assets
If it is not secured 100% provision is made.
For secured portion
if doubtful up to one year 20%
If doubtful more than 1 year but upto three years 30%
More than 3 years. 100%
In the case advances guaranteed by DICGC or ECGC provision is made for the balance in excess of amount guaranteed.
While creating provision for doubtful assets realisable value of securities shuld be first deducted from the outstanding balance.
In case of sub standars assets a general provision of 10% on total outstanding is made without making any allowance for DICGC or ECGC cover and securities available.
Provision on advances classified as doubtful is increased to 100% from 50% w.e.f. March 31, 2005
Disclosure : By Mr Dhirendra Singh views in the forum
How was the exam Sivaram ji
sir I am writing Final Group II only this attempt sir as i am working in a company and not a student
what are new rule for provisioningg assets in banking companies & how provisioning is done in ecgc cover ? explain me with example
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