In addition, Canadian banks have allowed more than 700,000 households to delay mortgage payments for up to six months. Banks have also provided payment deferrals and interest rate relief on other products such as credit cards, auto loans and lines of credit (Chart 12).
But to do deep surgery such as restructuring or writing down loans, the bank has to recognize it has a problem – classify the asset as a Non Performing Asset (NPA). Think therefore of the NPA classification as an anesthetic that allows the bank to perform extensive necessary surgery to set the project back on its feet.