The EU Commission has published its latest series of measures to tackle Non-Performing Loans (NPLs). This includes a proposed Directive on credit servicers, credit purchasers and the recovery of collateral and a proposed Regulation amending the Capital Requirements Regulation (CRR). This package complements the EU Commission’s Capital Markets Union plan and sets out a mix of policy actions that target four key areas:

• Encouraging the development of secondary markets where banks can sell their NPLs to credit servicers and investors by harmonising requirements and creating a single market for credit servicing and the transfer of bank loans to third parties across the EU
• Ensuring that banks set aside funds to cover the risks associated with loans issued in the future that may become non-performing.
• Facilitating debt recovery, as a complement to the insolvency and business restructuring proposal put forward in November 2016.
• A blueprint for establishing Asset Management Companies (AMCs) or other measures dealing with NPLs.

If you have any questions about these measures please contact Nick Smith