Financial Daily from THE HINDU group of publications
Friday, Oct 01, 2004
Financial Daily from THE HINDU group of publications Friday, Oct 01, 2004 |
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Money & Banking
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Non-Performing Assets NPA provisioning: RBI extends time for urban co-op banks Our Bureau
Mumbai , Sept. 30 THE Reserve Bank of India has told urban co-operative banks (UCBs) that additional provisioning on sub-standard assets may be phased over a five year period, commencing from year ending March 31, 2005. Further, UCBs may make a minimum of 10 per cent of the required provision in each of the first two years and the balance in equal instalments over the subsequent three years, the RBI has said in a circular issued to the chiefs of UCBs. In September 2002, the central bank had advised UCBs that effective from March 31, 2005, assets would be classified as doubtful if they remained in the sub-standard category for 12 months. UCBs were then permitted to phase the consequent additional provisioning over a four-year period commencing from the year ending March 31, 2005, with a minimum of 20 per cent each year. The apex bank has said that it had received requests from banks and federations of UCBs for giving some more time to restructure their accounts and progressively meet the stricter prudential norms. Its decision to allow UCBs to phase the provisioning over a period of five years as against four years earlier was based on the considerations and submissions made.
More Stories on : Non-Performing Assets | RBI & Other Central Banks | Co-operatives
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