Asset-Classification: The-RBI has issued guidelines-to the banks for classification of assets into four categories.assets classification in banking world
1. Standard Assets: Standard assets are those loans which do
not have any problem or have less risk. A standard asset is a performing asset.
Standard assets generate continuous income and repayments. Such assets carry a
normal risk and are not NPA in the real sense. So that, no special provisions
are required for Standard Assets.
2. Substandard Assets: These assets come under the category of
NPA, which assets are NPA from a period of less than 12 months. All those
assets (loans and advances) which are considered as non-performing for a period
of 12 months are called as Sub-Standard assets.
3. Doubtful Assets: These assets come under the category of
NPA, which assets exceeding more than 12 months.
4. Loss Assets: These NPAs which are identified as unreliable
by internal inspector of bank, external auditors or by RBL All those assets
whose recovery is not possible.
