Non-Performing Assets (NPAs)

Non-Performing Assets (NPAs) are loans or advances that a bank or financial institution has given to borrowers, but the borrowers have not repaid the interest or principal amount for a specified period, typically 90 days or more. Essentially, NPAs are overdue loans where the borrower has defaulted, and the asset (loan) is no longer generating income for the bank. NPAs indicate financial stress for banks and impact their profitability and stability. Managing NPAs is crucial for maintaining a healthy banking system and ensuring sufficient funds for new lending.