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  • Fig. 2.4

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    Cyruss Merano
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    This flowchart outlines measures for reducing nonperforming loans. It shows that for viable borrowers, banks can restructure loans or pursue legal action, while for nonviable borrowers the options are legal action, write-off, or sale of the loan. Net present value analysis is used to evaluate these options based on realistic recovery rates and costs.

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    This flowchart outlines measures for reducing nonperforming loans. It shows that for viable borrowers, banks can restructure loans or pursue legal action, while for nonviable borrowers the options are legal action, write-off, or sale of the loan. Net present value analysis is used to evaluate these options based on realistic recovery rates and costs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    12 views1 page

    Fig. 2.4

    Uploaded by

    Cyruss Merano
    This flowchart outlines measures for reducing nonperforming loans. It shows that for viable borrowers, banks can restructure loans or pursue legal action, while for nonviable borrowers the options are legal action, write-off, or sale of the loan. Net present value analysis is used to evaluate these options based on realistic recovery rates and costs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    Figure 2.

    4 Nonperforming loan reduction flowchart

    Borrower Nonperforming loan Net present value


    status reduction measure (NPV) analysis

    Loan
    restructure
    Viable/
    cooperative

    Legal
    action NPV analysis is
    based on realistic
    recovery and
    discount rates.
    All costs are included.
    Write-off

    Nonviable/
    uncooperative

    Sale

    Source: WDR 2022 team.

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