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Loan Write Off

A loan write-off is an accounting term for the process of removing a loan from a bank's financial records because it is unlikely to be repaid.

This means that the bank no longer expects to collect the full amount of the loan and it is removed from the bank's assets. The bank may also take a loss on the loan, which is reflected in their financial statements. A loan write-off typically happens when the borrower has defaulted on the loan and has no ability or intention to repay it. This can be seen as a measure of bad loans in a bank's books.

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