Appendix C: Asset Quality
Risk Classification of Assets
In the determination of the classification for loans and advances, performance will be the primary consideration. The performance will generally show the repayment capability of the borrower. All loans and advances should be classified by institutions according to the following criteria:- Days at Risk (Number of days past due) Classification a) Current and up to date in payments of principal and profit Normal b) 1 to 30 days in arrears or where one instalments for either principal or profit is due and unpaid Watch c) 31 to 60 days in arrears or where two instalments for either the principal or profit are due and unpaid Substandard d) 61 to 90 days in arrears or where three instalments of either principal or profit are due and unpaid Doubtful e) More than 90 days in arrears or where four or more instalments of either principal or profit are due and remain unpaid Loss Risk Classification of Assets and Provisioning
Portfolio Aging Report Classification No of loans /ACs Outstanding loan Portfolio Required Provision Required Provision Amount (SAR) Security Held Minimum provision % Portfolio at Risk Normal 1% Watch 5% Sub-standard 25% Doubtful 75% Loss 100% Other Non-performing Assets* Total Restructured/Rescheduled/ Renegotiated loans Normal 1% Watch 5% Sub-standard 25% Doubtful 75% Loss 100% Grand Total Completion Instructions
General
This return should be completed strictly in accordance with the Regulation on Asset Quality.
1. Enter in column A the number of accounts under each classification. 2. Enter in column B the amount outstanding under each classification categories of Normal Risk; Watch; Sub-standard; Doubtful and Loss. 3. Enter in column C the minimum provisions requirement in percentages in each classification category. 4. Enter in column D provisions required in each classification category. 5. Enter in column E the amount of security held in each classification category. 6. Enter the difference between column D and E in column G.