<<123456789101112131415161718192021222324>> 1. When does a term loan become classified as a Non-Performing Asset (NPA)?When the interest and/or instalment of principal remain overdue for more than 30 daysWhen the interest and/or instalment of principal remain overdue for more than 60 daysWhen the interest and/or instalment of principal remain overdue for more than 90 daysWhen the interest and/or instalment of principal remain overdue for more than 120 daysQuestion 1 of 24 2. How does a CC/OD account become classified as 'out of order'?When there is a delay in the repayment for more than 90 daysWhen there is a delay in the repayment for more than 60 daysWhen there is a delay in the repayment for more than 30 daysWhen there is a delay in the repayment for more than 120 daysQuestion 2 of 24 3. For how long should the instalment of principal or interest be overdue for agriculture loans to be classified as NPAs?Overdue for two crop seasons for short duration cropsOverdue for one crop season for long duration cropsOverdue for one crop season for short duration cropsOverdue for two crop seasons for long duration cropsQuestion 3 of 24 4. In securitization transactions, when does the liquidity facility amount become classified as an NPA?When the liquidity facility remains outstanding for more than 30 daysWhen the liquidity facility remains outstanding for more than 60 daysWhen the liquidity facility remains outstanding for more than 90 daysWhen the liquidity facility remains outstanding for more than 120 daysQuestion 4 of 24 5. Under what circumstances does an account receive an 'Out of Order' status?When there is a delay in repayment for more than 90 daysWhen the outstanding balance continuously exceeds the sanctioned limit/drawing powerWhen there are no credits for more than 60 daysWhen the outstanding balance is less than the sanctioned limit/drawing power for more than 30 daysQuestion 5 of 24 6. When is an amount considered 'overdue' in terms of a credit facility?When it remains unpaid for more than the sanctioned periodWhen it remains unpaid on the due date fixed by the bankWhen there is no credit facility availableWhen it remains unpaid for more than 180 daysQuestion 6 of 24 7. How is income from Non-Performing Assets (NPA) typically recognized in international banking practices?Recognized on accrual basis as soon as it becomes an NPARecognized as income only when it is actually receivedRecognized at the end of the financial yearRecognized based on the recovery period of the NPAQuestion 7 of 24 8. When can interest on advances against certain securities be taken to the income account?When the borrower requests itOn the due date, regardless of margin availabilityOn the due date, provided adequate margin is available in the accountsOnly if it has been realized after the due dateQuestion 8 of 24 9. When an advance becomes a Non-Performing Asset (NPA) at the end of the year, what should happen to the interest accrued and credited to the income account in the previous year?It should be realized immediatelyIt should be reversed or provided for if unrealizedIt should be accrued further for the next yearIt should be considered as non-taxable incomeQuestion 9 of 24 10. What action should be taken with accrued fees, commission, and similar income in relation to NPAs?They should continue to accrue until the NPA is resolvedThey should cease to accrue in the current period and be reversed or provided for with respect to past periods if uncollectedThey should be written off entirelyThey should be realized immediatelyQuestion 10 of 24 11. What should be done with the finance charge component of finance income on a leased asset that has accrued and was credited to the income account before the asset became non-performing and is remaining unrealized?It should be credited to the borrower's accountIt should be ignored until the asset is no longer non-performingIt should be reversed or provided for in the current accounting periodIt should be reinvested in the assetQuestion 11 of 24 12. Under what condition can interest realized on NPAs be taken to the income account?Only if the borrower has made a fresh depositProvided the credits towards interest are not out of additional credit facilities sanctioned to the borrowerIf the borrower agrees to pay a higher interest rateIf the credits towards interest are from the bank's own fundsQuestion 12 of 24 13. When does an asset fall under the category of 'Substandard Assets'?When it has remained an NPA for more than 12 monthsWhen it has remained an NPA for exactly 12 monthsWhen it has remained an NPA for less than or equal to 12 monthsWhen it has remained an NPA for more than 24 monthsQuestion 13 of 24 14. How is an asset classified as 'Doubtful' after being 'Substandard'?When it has remained 'Substandard' for 6 monthsWhen it has remained 'Substandard' for 12 monthsWhen it has remained 'Substandard' for 18 monthsWhen it has remained 'Substandard' for 24 monthsQuestion 14 of 24 15. When is an asset categorized as a 'Loss Asset'?When the bank anticipates a potential lossWhen loss has been identified but not written off whollyWhen the asset is more than 24 months past dueWhen the asset is 'Doubtful' for more than 18 monthsQuestion 15 of 24 16. What action allows a loan account classified as Non-Performing Asset (NPA) to be upgraded to a 'standard' account?Repayment of arrears of interest onlyRepayment of arrears of principal onlyRepayment of both arrears of interest and principalRegular submission of stock statementsQuestion 16 of 24 17. For MSME accounts with aggregate exposure less than Rs.25 crores, what defines the 'Specified Period' before considering upgradation to 'standard'?A period of six months from the commencement of the first payment of interest or principalA period of one year from the commencement of the first payment of interest or principal, whichever is earlierA period of one year from the commencement of the first payment of interest or principal, whichever is laterA period of three months from the commencement of the first payment of interest or principalQuestion 17 of 24 18. In the context of MSME accounts' upgradation, what is considered 'Satisfactory Performance'?No payment (interest and/or principal) remaining overdue for a period of more than 60 daysNo payment (interest and/or principal) remaining overdue for a period of more than 15 daysNo payment (interest and/or principal) remaining overdue for a period of more than 30 daysNo payment (interest and/or principal) remaining overdue for a period of more than 90 daysQuestion 18 of 24 19. What condition defines 'satisfactory performance' for a cash credit/overdraft account in MSMEs seeking upgradation?Outstanding in the account should not exceed the sanctioned limit for a period of more than 90 daysOutstanding in the account should not exceed the sanctioned limit for a period of more than 30 daysOutstanding in the account should not exceed the drawing power for a period of more than 60 daysOutstanding in the account should not exceed the sanctioned limit for a period of more than 60 daysQuestion 19 of 24 20. When can standard accounts classified as NPAs be upgraded if they demonstrate 'satisfactory performance'?After six months from the commencement of the first payment of interest or principalOnly when all outstanding loans or facilities in the account demonstrate 'satisfactory performance'After three months from the commencement of the first payment of interest or principalImmediately after the first payment of interest or principalQuestion 20 of 24 21. What defines the earliest time frame for the possible upgradation of standard accounts classified as NPAs?After the account remains in the NPA category for a minimum of one yearAfter one year from the commencement of the first payment of interest or principal, whichever is earlierAfter one year from the commencement of the first payment of interest or principal, whichever is laterAfter six months from the commencement of the first payment of interest or principalQuestion 21 of 24 22. How should borrowal accounts with solitary or few credits recorded just before the balance sheet date be treated?Treated as non-performing assets (NPAs) without any considerationConsidered based on inherent weaknesses indicated by the available dataAutomatically upgraded to standard accountsIgnored for classification purposesQuestion 22 of 24 23. What is the requirement for banks when dealing with accounts regularized near the balance sheet date to clarify doubts about their performing status?Banks must provide additional credit facilities to these accountsBanks should not disclose this information to Statutory Auditors/Inspecting OfficersBanks must furnish satisfactory evidence to Statutory Auditors/Inspecting Officers about the regularisation mannerBanks must withhold information until the next fiscal yearQuestion 23 of 24 24. How are accounts treated under consortium lending arrangements if the remittances by the borrower are pooled with one bank and not shared with other member banks?Treated as non-performing assets (NPAs) in the books of all member banksTreated as non-serviced in the books of other member banks and classified as NPAConsidered serviced accounts in the books of other member banksTransferred to the lead bank for proper asset classificationQuestion 24 of 24 Loading...
