IBA demands RBI to extend NPA classification period from 180 days to 90 days


Indian Banks’ Association (IBA) has requested banking regulator Reserve Bank of India to extend the days of declaring Non-Performing Asset (NPA) to 180 days which is currently 90 days, said sources.


According to ET, the association wrote to the Central Bank to extend a moratorium on loans and the standstill on stressed accounts by at minimum three more months due to the outbreak of coronavirus.

Besides, lenders wanted that the loans extended to overdue accounts should be considered at the standard category, or classified as a standard restructured asset, which would lead to lesser provisioning.

As reported by ET, banks also asked for a one-time restructuring of all loans and a specific term loan package for the sectors that are mostly affected due to COVID-19 pandemic.

“A lot of these issues were discussed with the RBI governor in a meeting he held with banks. Talks are on at individual banks and IBA levels. We are all working together to see the best way out of this crisis,” reported ET, quoting a banker.

 “The services sector has been the worst hit. We are discussing a corporate term-loan package for industries that are worst affected due to Covid-19. A one-time restructuring request has also been made,” the banker added.

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