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NPA classification norms significantly tightened

Daily NPA determination, full payment to move back to standard among several measures

– Anita Baid, anita@vinodkothari.com

RBI has issued a notification on Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances – Clarifications (‘RBI Circular’). The said RBI Circular dated November 12, 2021 is depicted to be a clarification issued by the RBI on the applicable prudential norms for all lending institutions. However, the same would have a major impact on the NPA classification by banks and NBFCs, specifically. The intention of the RBI is to clarify and harmonise certain aspects of the extant regulatory guidelines, making it applicable mutatis mutandis to all lending institutions Read more