New Delhi, June 15: Bankers fear that RBI's proposal to change the definition of bad loans from March 2004, may shoot up their NPAs by at least 3 per cent to 10 per cent of net advances in the next fiscal. "Net NPA is likely to be 8.5-10 per cent once the change in definition of classification of bad loans becomes effective from April, 2004," top bank officials said.
Apprehending higher provisioning for NPAs and a lower net profit, they said there was a need for change in the strategy to tackle this problem.

With a view to move towards international best practices and to ensure greater transparency, Reserve Bank of India had advised the commercial banks and urban cooperative banks to adopt 90 days norm for recognition of loan impairment from the year ending March 31, 2004.
This means that if a company fails to pay either interest or principal amount on loans taken from a bank beyond 90 days, the account would become NPA. Bureau Report