Asset which cease income of bank for two consecutive quarters is called as
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Explanation:
1. An asset, including a leased asset, becomes non performing when it ceases to generate income for the bank. 2.1.
2. A non performing asset (NPA) is a loan or an advance where.
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Asset which cease income of bank for two consecutive quarters is called as Nonperforming Assets.
- After the borrower has failed to make payments for an extended period of time, nonperforming assets (NPAs) are reported on the balance sheet of the bank.
- NPAs cost the lender money, and a high number of them over time may signal to authorities that the bank's ability to meet its financial obligations is in peril.
- NPAs can be categorised as substandard assets, dubious assets, or loss assets based on how long they have been past due and how likely it is that they will be repaid.
- Lenders have options to recoup their losses, including by seizing any collateral or selling the loan to a collection agency for a steep discount.
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