"Restructuring Funds”; an alternative tool for a systemic approach to active management of Unlikely to Pay (UTP)

Paolo Carriere

No 20132, BAFFI CAREFIN Working Papers from BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy

Abstract: This paper is aimed at illustrating an innovative tool/strategy to address the general, wider and multifaceted NPL issue from a banking perspective, focusing in particular on UTP; a half-way strategy between a traditional “hold/forbearance” approach and a traditional “portfolio reduction” approach, producing a change in the type of exposure. Such a new, complementary, tool is aimed at overcoming market inefficiencies that other “traditional” approaches/tools currently present and, at the same time, helping to effectively reduce the legacy assets at bearable levels. At the same time this is a “debtor-level” approach that pursues the concentration and coordination of all the exposures of the banking system vis-à-vis the same debtor, as a precondition for a successful restructuring process of corporate borrowers in distress. Such a tool can be identified in a so called “Restructuring Fund”, a specific and peculiar kind of AIF.

Keywords: Unlikely to Pay (UTP); Non Performing Loans (NPL); Restructuring Fund; Securitization; AMC (search for similar items in EconPapers)
Pages: 17
Date: 2020
References: Add references at CitEc
Citations:

Downloads: (external link)
https://repec.unibocconi.it/baffic/baf/papers/cbafwp20132.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:baf:cbafwp:cbafwp20132

Access Statistics for this paper

More papers in BAFFI CAREFIN Working Papers from BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy Via Röntgen, 1 - 20136 Milano - Italy. Contact information at EDIRC.
Bibliographic data for series maintained by Michela Pozzi ().