Non-Performing Loans in East Asia and the Pacific : Practices and Lessons in Times of COVID-19
Authorities in East Asia Pacific (EAP) jurisdictions have adopted a battery of fiscal, monetary, and financial measures aimed at mitigating the unprecedented impacts of the Coronavirus disease 2019 (COVID-19) pandemic on the economy. This report di...
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| Format: | Report |
| Language: | English |
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World Bank, Kuala Lumpur
2021
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| Online Access: | http://documents.worldbank.org/curated/undefined/275161635138844218/Non-Performing-Loans-in-East-Asia-and-the-Pacific-Practices-and-Lessons-in-Times-of-COVID-19 http://hdl.handle.net/10986/36522 |
| Summary: | Authorities in East Asia Pacific
(EAP) jurisdictions have adopted a battery of fiscal,
monetary, and financial measures aimed at mitigating the
unprecedented impacts of the Coronavirus disease 2019
(COVID-19) pandemic on the economy. This report discusses
the quality of loan portfolios in the banking sector of EAP
jurisdictions and the main vulnerabilities surrounding
credit markets that may negatively impact the credit quality
of banking portfolios and amplify the effects of the
COVID-19 crisis. Most EAP countries entered the pandemic
with solid capital and liquidity buffers built up following
the global financial crisis (GFC). If non-performing loans
(NPLs) are left unaddressed, they can have harmful feedback
effects on the banking system and the real economy.
Experiences in the aftermath of the Asian financial crisis
(AFC), and more recently the GFC, show that many countries
were affected by a legacy of high NPLs, which underscores
the need for a quick and comprehensive policy response. |
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