The study proposes a framework to choose the right non-performing loan (NPL) stock reduction strategy mix, through “on balance sheet” and “off balance sheet” solutions. The study considers as a reference point the European banking supervisory Authorities’ guidelines and regulations issued in the aftermath of the crisis to tackle the deterioration of banks’ loans portfolios. Moving from these references, the study investigates the strategic options that banks can implement to reduce non-performing loans (NPLs), taking into account the evolution of the external context and the bank-specific situation. In this sense, our study proposes some possible operating rules banks should consider when they implement strategic planning procedures and make their decision in the selection of the most suitable NPL reduction options

A strategic approach to Non-Performing Loans treatment in banking: options and rules for decision-making

Mazzu', S.
;
2018

Abstract

The study proposes a framework to choose the right non-performing loan (NPL) stock reduction strategy mix, through “on balance sheet” and “off balance sheet” solutions. The study considers as a reference point the European banking supervisory Authorities’ guidelines and regulations issued in the aftermath of the crisis to tackle the deterioration of banks’ loans portfolios. Moving from these references, the study investigates the strategic options that banks can implement to reduce non-performing loans (NPLs), taking into account the evolution of the external context and the bank-specific situation. In this sense, our study proposes some possible operating rules banks should consider when they implement strategic planning procedures and make their decision in the selection of the most suitable NPL reduction options
Non-performing loan reduction strategy, Financial crises, Credit quality
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/20.500.11769/316151
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