RBI

RBI tweaks conditions of disclosure of divergence in the asset classification & provisioning by banks

RBI specify threshold percentage for disclosure of divergence in asset classification & provisioning by banks with additional provisioning assessed by RBI 

The RBI vide Notification dated 18.04.2018 mandated disclosures by banks on divergences from prudential norms on income recognition, asset classification and provisioning exceed certain thresholds.

It had been stated that banks shall make suitable disclosures wherever: 

(a) the additional provisioning requirements assessed by RBI exceed 15 percent of the published net profits after tax for the reference period or

(b) the additional Gross NPAs identified by RBI exceed 15 percent of the published incremental Gross NPAs1 for the reference period, or both.

RBI has observed that in view of the above, some banks, on account of low or negative net profit after tax, are required to disclose divergences even where the additional provisioning assessed by RBI is small, which is contrary to the regulatory intent that only material divergences should be disclosed.

Therefore, now it has been stated that henceforth, banks should disclose divergences, if either or both of the following conditions are satisfied:

  1. the additional provisioning for NPAs assessed by RBI exceeds 10 per cent of the reported profit before provisions and contingencies for the reference period, and

  2. the additional Gross NPAs identified by RBI exceed 15 per cent of the published incremental Gross NPAs for the reference period.

Share

Recent Posts

  • ICSI

Empanelment of General Observers for ICSI Examinations December 2026. Last date 16.11.2026

Empanelment of General Observers for ICSI Examinations December 2026 ICSI has invited interested members to enroll as General Observers for…

12 hours ago
  • Income Tax

ITAT address some important issues relating to deduction u/s 80IA

ITAT answers some important and inter-related issues relating to deduction u/s 80IA In a recent judgment, ITAT has dealt with…

14 hours ago
  • Income Tax

Mere carry forward of loss can not be denied for belated return – ITAT

Carry forward of loss can not be denied for belated return, it is only the set off in subsequent year…

1 week ago
  • Income Tax

Sales duly recorded in books & VAT returns, can’t be held bogus without cogent adverse material

Where sales are duly recorded in books and VAT returns, to treat it bogus sales, AO must bringing cogent adverse…

2 weeks ago
  • Income Tax

ITAT allows Diwali expenses incurred by assessee as business expenses

Expenses to celebrate Diwali with staff creates a goodwill and, therefore amounts to expenses incurred for the purpose of business…

2 weeks ago
  • Income Tax

Section 292BB does not bar assessee to raise objection for non issuance of notice u/s 143(2) – SC

Section 292BB of the Income Tax Act, 1961 does not preclude Assessee raising objection for non issuance of notice u/s…

2 weeks ago