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What do you mean by Standard assets and how is it different from Loss asset? |
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Answer» Sub-standard asset is one which has been classified as NPA for a period not exceeding 12 months. In such cases, the current net worth of the borrower guarantor or the current market value of the security charged is not enough to ensure recovery of the dues to the bank in full. In other words, such an asset will have well-defined credit weaknesses that jeopardize the liquidation of the debt and are characterized by the distinct possibility that the bank will sustain some loss, if deficiencies are not corrected. A loss asset is or where loss has been identified by the bank or internal or external auditors or the RBI inspection but the amount has not been written off, wholly or partly. |
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