WBCS.LIVE practice question

‘Non-performing Assets’ (NPA) of Indian Commercial Banks are

Solve this multiple-choice question and check the correct answer with its explanation below.

Answer options

  1. Buildings and Land
  2. Loans not repaid within stipulated time
  3. Government securities
  4. Cash holding

Correct answer and explanation

Correct answer: Loans not repaid within stipulated time

Explanation: ✅ Correct Answer: B) Loans not repaid within stipulated time 📚 Explanation: Non-performing Assets (NPA) refer to loans or advances for which the principal or interest payment has remained overdue for a specified period, usually 90 days. They are assets that have stopped generating income for the bank. A high level of NPAs is a major concern for the health of the banking system and the overall economy. Banks must set aside funds to cover these losses, which reduces their ability to lend more.