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Write Off Impact Calculator

Work out write off impact instantly with clear inputs, formula shown and shareable results.

About Write Off Impact Calculator

Writing off a loan removes it from both impaired assets and advances, improving the reported ratio without any cash recovery. Only the unprovided portion hits profit, which is why heavily provisioned write-offs are nearly free to earnings.

Formula

Write-off effect

P&L hit = write-off - provision held; new ratio = (GNPA - write-off) / (advances - write-off)

Worked example

With the default values below, Write Off Impact Calculator returns Additional Charge To Profit of $5,000,000.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Amount Written Offminimum 0
25,000,000
Provision Already Heldminimum 0
20,000,000
Gross Non-Performing Assetsminimum 0
80,000,000
Gross Advancesminimum 0
900,000,000

Results

Additional Charge To Profit
$5,000,000.00
Impaired Ratio After The Write-Off
6.2857%
Impaired Ratio Before
8.8889%
Improvement In Basis Points
260.3

Step by step

  1. 1Values used
  2. 2Write-off effect
  3. 3Additional Charge To Profit= 5,000,000.00
  4. 4Impaired Ratio After The Write-Off= 6.2857
  5. 5Impaired Ratio Before= 8.8889
  6. 6Improvement In Basis Points= 260.3

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 4 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • Figures are estimates based on the inputs given. Bank charges, regulatory minima and market rates change and differ between institutions and jurisdictions. This is not financial advice — confirm with your bank or treasury policy.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Figures are estimates based on the inputs given. Bank charges, regulatory minima and market rates change and differ between institutions and jurisdictions. This is not financial advice — confirm with your bank or treasury policy.

Frequently Asked Questions

Does a write-off end the claim?

No. It is an accounting step; legal recovery efforts normally continue and any recovery flows to profit.

Why do impaired ratios improve so neatly?

Because write-offs shrink the numerator far more than the denominator, which is why cash recovery rates matter more than ratios.

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