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CAIIB-BFM-CASE STUDIES


Balance sheet of a bank provides the following information:

Total advances Rs 50000cr, Gross NPA 10% and Net NPA 3%, Based on this information, answer the following quwstions?

1. What is the amount of gross NPA?

a. Rs 4000cr
b. Rs 4500cr
c. Rs 5000cr
d. Rs 5500cr

2. What is the amount of net NPA?

a. Rs 1000cr
b. RS 1200cr
c. Rs 1500cr
d. Rs 1800cr

3. What is the amount of provision for standard loans, if all the standard loan account represent general advance?

a. Rs 150cr
b. Rs 160cr
c. Rs 180cr
d. Rs 200cr

4. What is the provision on NPA accounts?

a. Rs 3000cr
b. RS 3500cr
c. Rs 4500cr
d. Rs 5000cr

5. What is the total amount of provisions on total advances, including the standard accounts?

a. Rs 3500cr
b. Rs 3680cr
c. Rs 4000cr
d. Rs 4200cr

6. What is the minimum amount of provision to be maintained to meet the PCR of 70%?

a. Rs 3500cr
b. Rs 3680cr
c. Rs 4000cr
d. Rs 4200cr

7. What is the amount of provision for standard loans, if all the standard loan account represent direct advances to agricultural?

a. Rs 90cr
b. Rs 112.5cr
c. Rs 135cr
d. Rs 180cr

8. What is the amount of provision for standard loans, if all the standard loan account represent advances to SMEs sectors?

a. Rs 90cr
b. Rs 112.5cr
c. Rs 135cr
d. Rs 180cr

9. What is the amount of provision for standard loans, if all the standard loan account represent advances to CRE sectors?

a. Rs 112.5cr
b. Rs 180cr
c. Rs 337.5cr
d. Rs 450cr

10. What is the amount of provision for standard loans, if all the standard loan account represent advances to CRE-RH sectors?

a. Rs 112.5cr
b. Rs 180cr
c. Rs 337.5cr
d. Rs 450cr

 

Solution :

1. c
Gross NPA
= 50000 x 10 %
= 5000 Cr

2. c
Net NPA
= 50000 x 3 %
= 1500 Cr

3. c
Stadard Accounts
= Total advances - Gross NPA
= 50000 - (50000 x 10%)
= 50000 - 5000
= 45000

Provision for standard loans (general advance)
= 0.4%
= 45000 x 0.4%
= 180 Cr

4. b
Provision of NPA
= (Gross NPA - Net NPA) x Total Advances
= (10% - 3%) x 50000
= 7% x 50000
= 3500 Cr

5. b
Provision on Total Advances
= Provision of NPA + Provision for standard loans
= 3500 + 180
= 3680 Cr

6. a
Minimum amount of provision to be maintained to meet the PCR of 70%
= Gross NPA x PCR
= 5000 x 70%
= 3500 Cr

7. b
Stadard Accounts
= Total advances - Gross NPA
= 50000 - (50000 x 10%)
= 50000 - 5000
= 45000

Provision for standard loans (direct advances to agricultural)
= 0.25%
= 45000 x 0.25%
= 112.5 Cr

8. b
Stadard Accounts
= Total advances - Gross NPA
= 50000 - (50000 x 10%)
= 50000 - 5000
= 45000

Provision for standard loans (SMEs Sector)
= 0.25%
= 45000 x 0.25%
= 112.5 Cr

9. d
Stadard Accounts
= Total advances - Gross NPA
= 50000 - (50000 x 10%)
= 50000 - 5000
= 45000

Provision for standard loans (Commercial Real Estate (CRE) Sector)
= 1%
= 45000 x 1%
= 450 Cr

10. c
Stadard Accounts
= Total advances - Gross NPA
= 50000 - (50000 x 10%)
= 50000 - 5000
= 45000

Provision for standard loans (Commercial Real Estate (CRE) Sector)
= 0.75%
= 45000 x 0.75%
= 337.5 Cr

SME - Small and Micro Enterprises
CRE - Commercial Real Estate (CRE) Sector
CRE - RH - Commercial Real Estate – Residential Housing Sector (CRE - RH)

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