Introduction to NPA and Risk Management
Module 1: Understanding Non-Performing Assets
(NPA)
Definition of NPAs and classification: Sub-standard,
Doubtful, and Loss Assets.
Causes of NPAs: Borrower-related, lender-related, and
external factors.
Economic impact of NPAs on financial institutions.
Module 2: Regulatory Framework for NPA
Management
RBI guidelines and Basel III regulations on NPAs.
Impact of NPAs on capital adequacy and financial stability.
Compliance requirements for financial institutions.
Case Study
Module 3: NPA Identification and Classification
Techniques
Financial indicators and ratio analysis for detecting NPAs.
Red flags in borrower behavior and loan performance.
Practical Exercise
NPA Recovery and Legal Framework
Module 4: NPA Recovery Strategies
Recovery methods: Restructuring, restructuring with
external agencies, and legal action.
Using asset management companies (AMCs) and debt recovery
tribunals (DRTs).
Role of credit risk management in reducing NPAs.
Practical Exercise
Module 5: Legal and Ethical Considerations in
NPA Management
Legal process for recovering NPAs: Court proceedings,
repossession, and liquidation.
Ethical considerations in the management of NPAs.
Case Study
Module 6: Best Practices for NPA Management
Establishing early warning systems to prevent NPA buildup.
Best practices for monitoring loan portfolios and borrower
performance.
Developing effective communication strategies with
borrowers.
Group Discussion: Sharing experiences and strategies for
managing NPAs in different banking sectors.
Interactive Components
Case Studies: Participants will
analyze real-world NPA cases and determine strategies for classification,
recovery, and resolution.
Group Discussion:
Sharing experiences and challenges faced by participants in managing NPAs
across different financial institutions.
Practical Exercises:
Identifying potential NPAs in loan portfolios and formulating recovery
strategies.
