Overseas non-performing assets appeared earlier and have richer experience in the disposal of non-performing assets. Therefore, when it comes to the disposal of non-performing assets, our country will refer to the disposal methods of foreign non-performing assets to some extent. This will play a role in solving the problem of non-performing assets in our country. major.

Generally speaking, the recovery methods of non-performing loans of commercial banks usually include calling for repayment, negotiating settlements, legal proceedings, selling off collateral and restructuring debt. In addition, overseas financial institutions will also use securitization. Non-performing loans are disposed of through , auctions, entrusting professional institutions, establishing bank subsidiaries, and debt-for-equity swaps. Below, we will introduce the disposal of non-performing assets overseas to share with you the experience that can be learned from the disposal of non-performing assets in my country.

The main characteristics of overseas non-performing asset disposal

1. The government plays a leading role

Take the United States as an example. Since savings and loan institutions with non-performing loans have collapsed and Taken over by the Federal Deposit Insurance Corporation (FDIC) or the Resolution Trust Company, most of the distressed assets are held by the government.

A stable banking system is crucial to the country's financial security and economic security. Therefore, the government must use resources to support the disposal of non-performing assets of commercial banks and other financial institutions out of public interest considerations. Government support is a prerequisite for large-scale disposal of non-performing assets.

2. Establish a professional asset management institution (AMC)

The asset management institution (AMC) acquires and disposes non-performing assets from banks for centralized processing, using professional talents and operation models. Has a scale effect. By divesting non-performing assets from AMCs, banks can quickly shed their burdens and focus more on improving their own operations. Therefore, the establishment of a specialized asset management agency (AMC) has become the first choice for foreign countries to dispose of non-performing assets.

3. Multi-channel financing and the use of multiple means

Judging from the experience of the United States, Japan and South Korea, the governments of the three countries have always insisted on injecting funds from multiple channels in terms of sources of funds for the disposal of non-performing assets. On the one hand, Mainly through government capital injection, on the other hand, we also absorb funds through multiple channels. In addition, the disposal methods of non-performing assets of commercial banks are also a combination of various methods, all of which adopt flexible disposal methods according to their own characteristics to achieve the best disposal effect.

Main ways to dispose of overseas non-performing assets

1. Establish a professional asset management institution (AMC)

The asset management institution (AMC) acquires and disposes of non-performing assets from banks Centralized processing, the use of professional talents and operation models, and scale effects. By divesting non-performing assets from AMCs, banks can quickly shed their burdens and focus more on improving their own operations. Therefore, the establishment of a specialized asset management agency (AMC) has become the first choice for foreign countries to dispose of non-performing assets.

For example, the United States established the Restructuring Trust Company (RTC) in response to the surge in bank non-performing assets caused by the savings and loan crisis in the 1980s. During the Asian financial crisis, Japan established the Reorganization and Recovery Corporation in 1999 in response to the banking crisis. Agency (RCC), South Korea established the Korea Asset Management Corporation (KAMCO) in 1997. These AMCs have played an important role in the process of disposing of non-performing assets.

2. Internal bank disposal

In addition to establishing special AMC disposal, some large banks can rely on their own efforts to dispose of non-performing assets to get out of trouble. For example, the United States has adopted measures such as withdrawing bad debt reserves, adjusting the creditor's rights structure, legal means, and the "good bank, bad bank" model. Japan has adopted disposal methods such as controlling the scale of credit, increasing its own capital, using diversification, and pooling funds with private financial institutions. Regarding non-performing assets, South Korea has adopted measures such as reforming the credit management system, establishing an internal transfer price and performance appraisal system, flexible and diverse disposal methods, and a credit accountability system.

3. The state injects capital into banks and nationalizes them

By injecting capital into banks, the state improves the bank’s capital adequacy ratio and final solvency, optimizes the balance sheet, and improves the nationalization of banks. level, and at the same time encourage banks to dispose of non-performing assets.

On the one hand, for banks in crisis, it can play a role in extending the life of banks, avoiding bankruptcy, maintaining the bank's operations, and making further rescue and disposal of non-performing assets possible. On the other hand, for general problem banks, the injected funds can be used to write off bad debts and reduce the burden on the banks. Both Japan and South Korea have adopted corresponding capital injection measures.

4. Promote mergers and reorganizations

During the crisis, bankruptcies in the banking industry are inevitable. At this time, mergers and reorganizations have become an important means to deal with bank non-performing assets.

South Korea was the country with the fastest mergers and reorganizations in the banking industry during the Asian financial crisis. The total number of banks dropped from 33 in 1997 to 19 in 2002. In 1998, the Korean Financial Supervisory Commission fulfilled its commitment to the IMF and reorganized the banking industry. Five national banks facing crisis were suspended for rectification and delisted from the exchange. The same year also saw the merger of two regional banks and a national bank.

5. Direct government purchase

Whether it is external disposal through AMC, internal disposal relying on its own strength, or mergers and acquisitions between banks, they are all regulations that focus more on non-performing assets. Although most of the disposals are triggered by crises, they are also mechanisms that can exist for a long time after the crisis. In addition, during major financial crises, some governments will directly purchase undesirable countercyclical adjustment measures. These are usually special measures established separately to deal with the crisis, and are usually stopped after the crisis.

For example, on October 3, 2008, the U.S. Congress passed the "Emergency Economic Stabilization Act of 2008". The core of this bill is the "Troubled Asset Relief Program (TARP)", and the Ministry of Finance Raise funds by issuing bonds and other methods, and directly purchase non-performing assets from U.S. financial institutions, taking non-performing assets off the balance sheet and supplementing liquidity.

The Enlightenment of Overseas Non-Performing Asset Disposal to China

1. The government strengthens system design and coordinates disposal and supporting measures

The disposal of non-performing assets is extremely complex In terms of system engineering, banks’ own resolution capabilities are limited, and the government should do more. In terms of system and rule design, it is necessary to improve the legal, taxation and accounting frameworks, adjust the write-off standards for non-performing assets, strengthen the legal protection of investors in non-performing financial assets, clarify the detailed rules for local government debt swaps, and target the current "Internet" non-performing assets. New models such as asset disposal will be followed up in a timely manner and corresponding rules will be formulated.

In terms of coordination and disposal, we must severely crack down on debt evasion, coordinate the relationship between banks and law enforcement agencies, and optimize the legal enforcement environment for non-performing assets; local governments should take the responsibility for government debts and take the lead from the perspective of stabilizing the overall situation. Debt repayment and support for economic structural adjustment and upgrading. At the same time, the government should provide supporting measures to increase financial support for the disposal of non-performing assets, strengthen supervision of all aspects of disposal, prevent asset sales and illegal transfer of interests, and attach great importance to the social consequences that may arise from the closure and merger of enterprises during the disposal of non-performing assets. To solve the problem, we should do a good job in personnel placement and diversion compensation, introduce policies to cultivate and support the transformation of enterprises, and implement more active employment policies. Our country is a country where indirect financing is the main financing method. Bank non-performing assets are large in scale and widely distributed. Therefore, various methods must be used to cooperate with each other and deal with them comprehensively.

2. Make full use of market mechanisms to improve disposal efficiency and the value of non-performing assets

The successful disposal experience in the United States shows that to resolve bank non-performing assets, the relationship between the government and the market must be properly handled. my country should give full play to the industry experience and professional advantages of the four major asset management companies, gradually enhance the functions and competitiveness of local asset management companies, launch pilot projects for the securitization of non-performing assets and the transfer of the income rights of non-performing assets as soon as possible, and accelerate the cultivation and improvement of the non-performing asset circulation market. investment entity.

Explore the use of social capital in asset disposal, and guide professional intermediary companies such as securities, insurance, trusts, financial leasing, fund companies, financial appraisal companies, accounting firms, and law firms to give full play to their functional advantages and enhance Value management space. Study the implementation principles and conditions for the market-oriented operation of debt-for-equity swaps and proceed prudently.

3. Diversified means

In the process of disposing of non-performing assets, we should innovate the methods of disposing of non-performing assets and improve the ability to diversify the disposal of non-performing assets to ensure the stability and controllability of the assets. Our country's financial institutions can learn from foreign experience, use a variety of methods together, and flexibly use different means according to different situations to improve capital utilization, promote fund recovery, and speed up the disposal process.