Banking Exam Question - What are the NRB Directives (2074) about Loan Loss Provision against Normal Loan & Restructured Loans? Explain

Introduction - NRB Loan Loss Provision against Normal & Restructured Loan

The loan loss system will be made to be followed as per the reason behind the debt of restructuring or reorganization:

(A) Reduce the minimum bulls (12.5%) loan penalty for rebuilding or recycling the loans being classified in the good class during the time of rebuilding or recycling. No adjustments will be made except for the rest of the loan due to regular restructuring of the loan made by rebuilding or recycling loans which is classified as a minor, suspicious and defective category. 

In case of debt consolidation and interest in regularity of debt provided in a document or a monthly basis, in the current financial year, the loan will not be made to rebuild additional debt in addition to restructuring or reorganization.

• Due to the advance payment of debt (HHW) due to the amount of the document and the number of the customer is low.
• Due to the interest rate change of debt due to variable interest rate change due to the time frame and the amount of the loan. With interest rate increase due to this period, the time period and the amount of loan has not been added, the amount determined at the time of sanctioning loan will not be reduced.

Likewise, interest rates will reduce the time period and the amount of debt and the decrease in the amount of the specified amount will be reduced if the loan has gone down.

(B) Such debt can be converted into good debt in case of renewal of rebuilding or recycled loans and payment of interest and regular interest for two years.

C) The amount of debt flow from banks and financial institutions can increase the interest of the projects, increase in other costs or increase the capacity of the production and the loan can not be paid at the time of payment of loan prescribed at the beginning (net profit margin) in the preliminary categories of high priority, hydro power, calculator, cement or other Prepare infrastructure related projects to the following conditions.