Prudential norms on income recognition, asset classification and provisioning - Projects under implementation involving time overrun - RBI - Reserve Bank of India
Prudential norms on income recognition, asset classification
and provisioning - Projects under implementation
involving time overrun
February 27, 2003 DBOD. BP. BC.74 / 21.04.048/ 2002-03 All Scheduled Commercial Banks Prudential norms on income recognition, asset classification and provisioning- Projects under implementation involving time overrun Banks were advised vide paragraph 3 of Circular No. DBOD. BP. BC. 108/ 21.04.048/ 2001-02 dated 28 May 2002 that the projects under implementation would be grouped under three categories for determining the date when the project ought to be completed and manner in which the asset classification of the underlying loan should be determined. It was indicated therein that :
Banks were also advised that there was no change in the existing instructions on income recognition and were advised that they should not recognise income on accrual basis in respect of the above projects. 2. The matter has been reviewed in response to suggestions received from some banks. In partial modification of the above guidelines, it has been decided that banks may recognise income on accrual basis in respect of the above three categories of projects under implementation which are classified as 'standard' in terms of the guidelines contained in the above circular. 3. Please acknowledge receipt. Yours faithfully, (M. R. Srinivasan) |