Economic and Financial Affairs Council - Banking - Non-Performing Loans

The Council approved an action plan to address the problem of non-performing loans (NPLs) in the banking sector.

It outlined a mix of policy actions to help reduce stocks of NPLs, which remain at high levels within the EU, and to prevent their future emergence.

"Non-performing loans are a problem for the banking industry for which solutions have until now been mainly defined at the national level", said Toomas T?niste, minister for finance of Estonia, which currently holds the Council presidency. "We need to free up these resources, make our financial system more resilient and prevent the re-emergence of NPL issues in the future."

On the basis of an expert report, the Council highlighted the need for action as regards: 

• Bank supervision
• Reform of insolvency and debt recovery frameworks
• Development of secondary markets for NPLs
• Restructuring of the banking industry.