Description

Europe’s banking system is weighed down by high levels of non-performing loans (NPLs), which are holding down credit growth and economic activity. This discussion note uses a new survey of European country authorities and banks to examine the structural obstacles that discourage banks from addressing their problem loans. A three pillared strategy is advocated to remedy the situation, comprising: (i) tightened supervisory policies, (ii) insolvency reforms, and (iii) the development of distressed debt markets.

More publications in this series: Staff Discussion Notes

More publications by: Shekhar Aiyar ; Wolfgang Bergthaler ; Jose M Garrido ; Anna Ilyina ; Andreas Jobst ; Kenneth H Kang ; Dmitriy Kovtun ; Yan Liu ; Dermot Monaghan ; Marina Moretti