Saturday, May 15, 2010

PRUDENTIAL NORMS ON ADVANCES TO INFRASTRUCTURE SECTOR

It has been decided that infrastructure loan accounts which are classified as sub-standard will attract a
provisioning of 15 per cent instead of the current prescription of 20 per cent. To avail of this benefit of lower provisioning, the banks should have in place an appropriate mechanism to escrow the cash flows and also have a clear and legal first claim on these cash flows.

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