Non-performing Loans – Different this Time? NPL resolution after COVID-19

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Series Details PE 659.645
Publication Date March 2021
ISBN 978-92-846-7866-2
EC QA-02-21-278-EN-N
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Abstract:

Model estimates of NPLs of a large sample of banks in the euro area suggest that macro-economic factors drive NPLs. This implies that the NPL-ratio may not increase in a similar fashion as after the global financial crisis. However, the low fit of the model shows that idiosyncratic factors play a major role in explaining NPLs. This is illustrated in a case study for the Netherlands which suggests that deferred tax payments may lead to increasing NPLs.

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This document was provided/prepared by Economic Governance Support Unit at the request of the ECON Committee).

Source Link Link to Main Source https://www.europarl.europa.eu/thinktank/en/document.html?reference=IPOL_IDA(2021)659645
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  • https://www.europarl.europa.eu/RegData/etudes/IDAN/2021/659645/IPOL_IDA(2021)659645_EN.pdf
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