Loss
Loss loans are - loans that are considered uncollectible and of such little value that their continuance as bankable assets is not warranted.
This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer full provision or writing off this basically worthless loan even though partial recovery may be effected in future
. Loans possessing any of the following characteristics shall be classified as
Loss.
Severe delinquency.
The borrower’s whereabouts is unknown, or he is insolvent, or his earning power is permanently impaired and the guarantees are not financially supported (not collateralized).
The collateral is worthless or undetermined value of collateral.
Loans considered by the management of the bank as absolutely uncollectible.
Remain past due for 630 days or more.