Such support to borrowers who are in temporary financial difficulties need not be contingent upon retention of asset classification status as “standard”. There is a tendency among banks to withdraw their support once an account is classified as NPA. Mere classification of an account as non-performing asset need not result in withdrawal of support to viable borrowal accounts.
The purpose of asset classification and provisioning is to present a true picture of bank’s balance sheet and not to stigmatize accounts / borrowers.