Non-performing and problem loans are a major cause of poor profitability in banks, and can, and have led to, bank failures. In addition, they can also negatively affect lending to the economy as a whole. As such, levels of problem loans are a key concern to supervisors and central banks. Supervisors generally monitor the overall level of non-performing loans across their banks, and assess whether individual banks are adequately managing the riskiness of their loans and if they have appropriate strategies, governance structures, and processes in place.

Target Participants: Participants should have at least four or five years’ supervisory or credit risk specialist experience. Although they may not have direct experience in handling problem loan situations, the participants should have sufficient familiarity with bank supervisory processes so that they can actively contribute to interactive course discussions.

The course will enable the participants to detect and diagnose non-performing and problem loans. The modules will cover undertaking asset quality and provision adequacy reviews; valuation of loans and security from accounting as well as risk management and regulatory perspectives; forbearance; restructuring and rescheduling loans; sale of non-performing loans; and new guidelines for loan loss provisioning under IFRS 9.