Bad loans have now increased by 135 per cent from Rs. 2, 61,843 crores in the last two years. A non-performing asset, or merely NPA, is well-defined as a credit facility for which the interest or the instalment of principal or both, has remained overdue for a specified period of time. In other words, an asset is called as a non-performing one, when it has topped to generate income from the borrower of the asset for the lender of the asset.
Over the past two decades, there have been two such occurrences when the banking sector got severely weakened by balance sheet problems. GDP slowdown – Between early 2000’s and 2008 Indian economy were in the boom phase. During this period Banks particularly Public sector banks lent extensively to co…
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