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    Question

    What does Provisioning Coverage Ratio (PCR) indicate?

    A The profitability of the bank Correct Answer Incorrect Answer
    B The extent of loan losses covered by provisions. Correct Answer Incorrect Answer
    C The liquidity position of the bank Correct Answer Incorrect Answer
    D The capital adequacy of the bank Correct Answer Incorrect Answer
    E The credit quality of the bank's assets Correct Answer Incorrect Answer

    Solution

    Provisioning Coverage Ratio (PCR) is the ratio of provisioning to gross non-performing assets, which indicates the extent to which a bank has set aside funds to cover potential loan losses.

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