Bank of baroda

Restructured Assets
The RBI has separate guidelines for restructured assets. A fully secured standard asset can be restructured by rescheduling
the principal or interest payments, but must be separately disclosed as a restructured asset during the year of restructuring.
The amount of sacrifice if any, in the element of interest, measured in present value terms, is either written off or provided
for to the extent of the sacrifice involved. Similar guidelines apply to sub-standard assets. Sub-standard assets which
have been restructured, whether in respect of principal or interest payments, are eligible to be upgraded to the “standard
assets” category only after a specified period, which is one year after the date when first payment of interest or of
principal, whichever is earlier, falls due, subject to satisfactory performance during the period.
In order to create an institutional mechanism for the restructuring of corporate debt, RBI has also created a corporate
debt restructuring (CDR) system in 2003. The objective of this framework is to provide a more timely and transparent
mechanism for the restructuring of corporate debts of viable entities facing financial difficulties. This system has led to the
approval of restructuring programs for a large number of companies, which has resulted in an increase in the level of
restructured assets in the Indian financial system, including an increase in our restructured assets.
Following table presents our assets restructured during the periods indicated:
(Rs. in million)
March 31,
2003
2004
2005
CDR Restructured Assets
Standard Assets
1,504.10
5,752.50
4,819.20
Substandard Assets
0.00
133.80
132.30
Doubtful Assets
0.00
1,887.20
0.00
Loss Assets
0.00
0.00
0.00
Total CDR Restructured Assets