Q. Consider the following statements regarding “Non-Performing Assets (NPAs)”:
1.It is a loan or advance for which principal or interest payment remained overdue for a period of 30 days.
2.There is an increase in gross non-performing assets (GNPA) ratio of Indian banks in recent years.
Which of the statements given above is/are correct?
Red Book
Red Book

[A] 1 only

[B] 2 only

[C] Both 1 and 2

[D] Neither 1 nor 2

Answer: D
Notes:

Explanation: NPA is a loan or advance for which principal or interest payment remained overdue for a period of 90 days.

  • There is a decline in gross non-performing assets (GNPA) ratio of Indian banks.
  • In 2017-18, this ratio was as high as 11.2 % raising concerns on the stability of the banking system.
  • During last three years (2019-22) alone fresh NPAs add up to ₹10.61 lakh crore

Source: FORUMIAS

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