Multiple choice

For a securitization company, when the financial asset is purchased, which of the following is not true?

  1. The company has to formulate a realization plan within 12 months.

  2. Account will be standard account during this plan period, after which it will be NPA after 90 day delinquency period.

  3. Account will be sub-standard assets for a maximum of 12 months.

  4. When the asset is acquired for reconstruction, there is a limit of 10 years for such reconstruction.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

It has been prescribed that the plan of realisation of assets shall not exceed five years from the date of acquisition of asset. Thus, option 4 gives the wrong information.

Keep practicing — related questions