Private Sector Finance

Resolution of Non Performing Assets

Resolution of Nonperforming Assets – At present, many local banks across Asia are saddled with non-performing loans (NPLs) or sub-performing loans, foreclosed real state properties, and other non-performing assets (NPAs) for which they have neither the management time nor the resources for proper resolution. Ultimately, this leads to a depletion of loanable funds for banks, resulting in slower credit growth. Tighter credit restricts economic growth and development, as enterprises are unable to access capital.

To help local banks resolve their NPL/NPA problems, ADB facilitates the financing of special purpose vehicles and other mechanisms that acquire and service such assets. This enables local banks to focus on its core operations and provide financing to productive sectors of the economy.

In addition, ADB also helps distressed companies in restructuring and rehabilitation efforts.

By shifting distressed assets to organizations and professionals better equipped to manage them, economic fundamentals and new bank lending has repeatedly been shown to improve significantly.