Non-performing assets (NPAs), also known as non-performing loans, are loans where the borrower has failed to make scheduled principal or interest payments for 90 days or more.
NPAs are classified by risk severity into substandard, doubtful, and loss categories.
High NPA levels are damaging to the banking sector and economy — they reduce bank profitability, limit lending capacity, and threaten overall financial system stability.
Bangladesh faces a chronic NPA problem. According to Bangladesh Bank data, non-performing loans have been steadily rising. The government and Bangladesh Bank are taking steps to address this, including loan restructuring policies and legal action against defaulters.