Q. Reg. Drawing Power

Question

Dear Sir

In loan policy of a Urban Co-op. Bank, in case of cash credit limits, there is no reference of Drawing Power. As per bank's perspective, the drawing power is equal to sanctioned limit. There is no system of obtaining stock statement. Even, if any party submits the stock statement, no drawing power is calculated and if, calculated that is much lesser than the amount withdrawn.

In maximum cases, no transactions are in the account and only interest is served. Even diversification of funds is also there.

The bank is not marking such accounts NPA.

Whether, in the absence of drawing power clause in loan policy, the guideline provided under RBI master circular should apply and as per RBI circular, can we report such accounts as NPA (depending upon case to case).

Thanks