alleryThe general provision on a substandard asset is:
A15 per cent
B25 per cent
C45 per cent
D55 per cent
Answer & Solution
Correct answer: A. 15 per cent
1. It is charged on the total outstanding.
2. No allowance is made for ECGC cover or securities.
3. The rate is 15 per cent.
_Source: RBI Master Circular, Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances_
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