The Reserve Bank of India tightened the norms for sale of non-performing assets on Thursday, directing financial institutions not to sell the bad debt below realisable value.
"Banks' board are required to lay down policies and guidelines covering among other things, valuation procedure to be followed to ensure that the economic value of financial assets is reasonably estimated based on the assessed cash flows arising out of the repayments and recovery prospects," RBI said in the fresh guidelines on sale of NPAs.
The central bank observed that "in some cases NPAs