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Glossary for NPA

"A" Asset Quality Review :- It is the assessment of  credit risk associated with a particular asset. Asset Reconstruction Companies (ARC)  :- Registered under companies act, 2013. The primary goal of ARC is to make profitable those assets which have been underperforming or classified as NPA. "C" Credit Risk   :- It is the risk of default by borrowers. "E" Expected Loss :- Amount that the bank is eventually expected to lose on that loan. "P" Prompt Corrective Action (PCA)  :- RBI has set some trigger points on banks, if these are triggered, then actions will be taken by RBI. Actions like restricting the banks to not provide big loans & there will be raising of fresh capital also. "R" Restructured Assets :- It means the old asset or loan becomes new after reducing the size by paying off the amount which is affordable by the company (or borrower). "W" Write offs :-  In banking terms, ...

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