How to Assess the Benefits of Nonperforming Loan Disposal in Sub-Saharan Africa Using a Simple Analytical Framework

Irina Bunda, Luc Eyraud and Zhangrui Wang

No 2021/006, IMF Fiscal Affairs Department from International Monetary Fund

Abstract: The coronavirus (COVID-19) crisis, which has hit financial systems across Africa, is likely to deteriorate banks’ balance sheets. The largest threat to banks pertains to their loan portfolios, since many borrowers have faced a sharp collapse in their income, and therefore have difficulty repaying their obligations as they come due. This could lead to a sharp increase in nonperforming loans (NPLs) in the short to medium term.

Keywords: Nonperforming loan disposal; Excel template; disposal strategy; raise capital requirement; loan portfolio; management cost; Nonperforming loans; Loans; Distressed assets; Financial statements; Collateral; Sub-Saharan Africa; Africa (search for similar items in EconPapers)
Pages: 22
Date: 2021-06-08
New Economics Papers: this item is included in nep-afr and nep-ban
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