RBI has said that the banks need to disclose more details about their Non Performing Assets (NPAs). The apex bank has said that an in-depth information is needed about the market workings of the banks, including the list of their main 20 depositors, 20 biggest borrowers, 4 biggest NPAs on the books of the banks and any special purpose vehicles (SPV) financed by them during this fiscal.
Officials say, RBI has taken this measure to ensure the banking sector adheres to the best practices standard and also as a step towards making the banking system more transparent. It has also become necessary to keep a watch on NPAs as they show the number of loan defaults that impacts the profitability and net worth of banks.
The record for this admission must be in banks’ balance sheets titled ‘Notes to Accounts’.
Besides giving the list of main 20 depositors, banks will also have to disclose the portion of these deposits in the total deposit base.
Also, banks will have to submit the list of 20 biggest borrowers and the details of exposure credit as well as investment to leading 20 customers.
The new RBI norm claims that banks have to show their NPAs in sectoral fashion meaning the sector-wise allocation of exposure to NPAs. The sectors to be included are agriculture and related sector; industry (micro & small, medium, and large), services and Personal Loans.
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