Open credit card balances and car payments are bad debt.
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But the market for bad debt is struggling to take off.
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Huarong is one of China's largest state-owned bad debt managers.
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Think of debt in two categories: good debt and bad debt.
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The strict new guidelines for bad debt she unveiled on Oct.
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Financial stocks have been battered on fears of rising bad debt.
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When you were making Bad Debt , your youngest was a newborn.
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Some have given up on the worst of the bad debt.
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OCBC's bad debt charges for loans and other assets rose 25 percent to S$193 million in the fourth quarter from a year earlier, reflecting an industry-wide trend of rising bad debt as Asian economies slow.
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Ultimately, much of that bad debt turns into losses for the banks.
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Others include securitising bad debt and swapping non-performing loans for equity.
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Bad debt is unnecessary debt that is accumulated through poor financial decisions.
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At the same time, reimbursement for bad debt has seen significant reductions.
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It is one of the biggest bad-debt piles in European banking.
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It also enhances the trading of bad debt in the secondary market.
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Even state-owned bad debt specialists - referred to as AMCs - are suffering.
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"Good debt is bad debt when you're drowning in it," she says.
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"The bad debt problem in the corporate sector is still substantial," said Baig.
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The new measures are intended to prevent another bad debt pile from forming.
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Germany, which has very low levels of bad debt, would probably oppose it.
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The inflow of new bad debt should remain contained, assuming no economic stress.
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Beijing, facing around $300 billion in officially documented bad debt, needs structural change.
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If so, you can write it off as bad debt, Greene-Lewis said.
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Smaller bundles of NPLs would enable banks to offload the bad debt faster.
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READ MORE: Italian banks drowning in bad debt End of the European dream?
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Reuters on Thursday reported on regulators' efforts to help ease banks' bad debt.
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I'd been making music for many, many years before I made Bad Debt.
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Efforts are underway to make it easier for banks to restructure bad debt.
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"Good debt is bad debt when you're drowning in it," Schwab-Pomerantz says.
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Westpac increased its bad debt charges to a six-year high in the first-half in anticipation of a rise in bad debts, but said in a limited third-quarter update that bad debt ratios were still near all-time lows.
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Banking stocks sagged after Chinese lenders posted flat profit growth amid rising bad debt.
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Indian banks are saddled with a corporate bad debt mountain of around $121 billion.
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Brexit uncertainty also highlighted the high levels of bad debt held by Italian banks.
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Banks have agreed with regulators on ambitious bad debt reduction targets over three years.
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Italy's Treasury last week renewed the scheme designed at helping banks shed bad debt.
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That leads businesses to write off $29 billion a year in uncollectable bad debt.
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That leads businesses to write off $120 billion a year in uncollectable bad debt.
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China has too many empty homes and its banks have too much bad debt.
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Bad debt, though superficially contained, is thus becoming a millstone around the economy's neck.
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Provisions for bad debt rose 37 percent quarter-on-quarter to 349.7 million euros.
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But the bad debt is declining, Indian Finance Minister Arun Jaitley said in September.
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Bad debt in the regulated and largely publicly owned banking sector is rising (see chart).
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Banks accepted the highest bid — whatever the market would bear — and settled a bad debt.
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Vast losses from bad debt and litigation merely obscured billions of dollars in operating profits.
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Investors expect sales of bad debt to continue, but with a bigger discount to buyers.
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Under the new rules, banks can't use loan restructuring schemes to delay recognizing bad debt.
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We have good debt, we have bad debt, and they should be treated very differently.
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Bad debt has hampered banks' ability to lend, threatening to throttle a nascent economic recovery.
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Indian banks and financial institutions, in all, hold bad debt of over 10 trillion rupees.
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Great Wall is also setting up a series of new industrial funds, with a total value of 300 billion yuan ($43.7 billion), over the next three years to expand its bad debt business, including bad debt solutions, mergers and restructuring, as well as real estate.
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CITIC said in December its profit for 2015 will be lower due to bad-debt losses.
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Chinese banks' official bad-debt ratio, climbing since 2012, held steady last year at about 1.7%.
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Despite concerns about China, bad debt provisions in Asia were up a fairly modest 7 percent.
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Home loans also pose lower bad-debt risks for the banks than corporate loans, data shows.
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The Southeast Asian nation has targeted to keep the 2016 bad debt ratio under 3 percent.
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Greek banks remain focused on reducing their bad debt portfolios and meeting targets agreed with regulators.
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Net charge-offs, a measure of costs for bad debt, declined 13 percent to $934 million.
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"Hospitals will avoid a potential spike in bad debt and charity care next year," Tanquilut said.
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The government is also encouraging banks to convert bad debt into equity in their troubled borrowers.
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As for the Iran's economy, Iran currency slumped; banks are facing the challenge of bad debt.
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That is likely to drive up bad debt costs for banks as more loans go sour.
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Many state-run banks have accepted equity in exchange for bad debt rather than being repaid.
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However, net interest income was weak at both banks, which also saw bad-debt provisions climb.
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HONG KONG (Reuters Breakingviews) - China's campaign to cut bad debt is at risk of losing resolve.
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Meanwhile, credit card debt is almost always "bad debt," because it has much higher interest rates.
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"While the extra $2500 million in bad debt charged announced by [ANZ] due to the resources slump is small, investors naturally worry that the bad debt cycle has now bottomed, and like cockroaches, if there is one downgrade, there are likely to be more," he said.
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Net charge-offs, a measure of costs for bad debt, declined to $880 million from $1.1 billion.
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Greek banks are still cautious about consumer loans as they emerge from a mountain of bad debt.
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Provisions for bad debt rose to 669 million euros from 296 million euros in the third quarter.
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Indian banks and financial institutions, in all, hold bad debt of over 268.51 trillion rupees ($150 billion).
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Rival NBG was loss-making in the three months through June after booking higher bad debt provisions.
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That would mean its bad debt could triple from the 60.88 billion rupees reported at end-March.
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Banks have agreed with regulators on ambitious bad debt reduction targets spanning a 3-year time horizon.
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They now face uncertain revenues and the possibility of increased bad debt as they lose paying patients.
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Provisions against bad debt are a mere 0.13 percent of the bank's loans, and rising only slowly.
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Italy did not, partly in the misplaced hope that economic recovery would lighten its bad-debt load.
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Hospital groups have blasted payment cuts to bad debt, long-term care hospitals and inpatient rehab facilities.
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That's below a regulatory threshold of 150 percent, as rising bad debt write-offs erode capital buffers.
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They have agreed with regulators on ambitious bad debt reduction targets spanning a 3-year time horizon.
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Experts say the Indian government's latest plan may not be enough to fix its bad debt problems.
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Levels of provisions for bad debt across the banking sector should improve in 2017 said al-Ghurair.
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"Credit card debt is bad debt, so monitoring your reports is like visiting your doctor," she said.
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But depreciating assets that are not tax deductible, such as credit cards, are generally considered bad debt.
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The curbs were imposed because the banks had a low capital base and major bad debt problems.
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The group said bad debt provisions rose to 1.18 billion euros from 312 million in the third quarter.
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Caixabank's net profit was 365 million euros on the back of lower bad debt provisions and falling costs.
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Indian banks have turned cautious with lending decisions after a surge in their bad debt to $150 billion.
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That's because the assumption was bad debt would decrease once the number of people with insurance coverage increased.
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The revised provisioning requirements will not cover the huge amount of bad debt already on bank's balance sheets.
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Last year, the total bad debt pile for all listed and unlisted Chinese banks stood at $297 billion.
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China has enough resources to absorb much of the bad debt, while default risks political and social unrest.
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Bad debt charges nearly doubled in the first half to a six-year high of A$667 million.
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The four banks named by the regulator on Wednesday are not the only ones struggling with bad debt.
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Indian banks and financial institutions currently hold a total bad debt of over 10 trillion rupees ($146 billion).
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That was helped by a fall in bad debt charges and lower costs, according to the news wire.
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Moves are afoot to boost Atlante, perhaps with a new bad-debt fund of €3 billion-5 billion.
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Under the new rules, banks are not able to use loan restructuring schemes to delay recognizing bad debt.
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Adding to China's burden are its inefficient state-owned enterprises and a financial system threatened by bad debt.
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That would mean fewer insured patients and more bad debt for hospitals and fewer paying customers for insurers.
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Hospitals and other providers will pass along bad debt and costs associated with charity care for uninsured people.
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Provisions for bad debt edged higher to 246 million euros from 33 million euros in January-to-March.
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Beijing's loudly touted Belt-and-Road initiative looks increasingly like a swamp of corruption, malinvestment and bad debt.
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The company could afford to write off the bad debt, but borrowers remained on the hook for billions.
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Credit card debt, however, is considered to be "bad" debt because it typically comes with high interest rates.
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The bad debt manager could also provide capital for a potential deal, according to one of the people.
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"Debt for consumption, or for anything that doesn't produce more income than it costs, is bad debt," Dalio says.
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The Indian government unveiled the details of its mega bank recapitalisation plan aimed at tackling record bad debt woes.
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The deal is also valuable for Modi's government, as it seeks to clear India's $150 billion in bad debt.
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This is just one example of the problems that, in practice, are still likely to hinder bad debt resolution.
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They continue to make bad debt provisions as unemployment has made it hard for borrowers to service their debts.
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HSBC warned on Thursday that allowing borrowers to pay in shares was a limited solution to bad debt problems.
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Bad debt charges rose to S$436 million in the third quarter from S$178 million a year ago.
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It is widely believed that the bad debt burden of China's lenders could be much higher than official figures.
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They will work off bad debt over time but I think they have all the means to do that.
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The steel industry contributes 29 percent of overall banking sector bad debt of around $135 billion, according to government data.
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While NPL rates are stabilizing at the so-called Big Five, analysts reckon bad debt formation will continue to grow.
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In recent months UniCredit, Italy's largest lender, has written down bad debt by €250bn ($211.7bn) and tapped shareholders for €213.4bn.
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The bank's bad debt charges rose 87 percent percent to S$462 million from S$247 mllion a year earlier.
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China's banks are expected to hold a minimum of 150 per cent more capital against their balance of bad debt.
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Monte dei Paschi is Italy's third-largest lender and had more than $25 billion in bad debt as of 2015.
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Still, the IMF said Chinese authorities shouldn't hold back efforts to reform the economy, particularly the cutting of bad debt.
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They make banks safer: they can be used to absorb bad-debt costs or rebuild capital buffers when recession strikes.
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Shareholder infighting, a still-high bad debt burden and poor profitability make the bank - Italy's 10th largest - a tough sell.
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Atlante's involvement in the two cash calls has raised concerns its impact on the bad debt market will be limited.
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After last year's squeeze to control bad debt, officials let up a bit in the first three months of 2019.
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A number of forecasts, he said, put China's bad debt at between 6 and 603 percent of bank balance sheets.
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"New bad debt formation is negative, as the economy slowly recovers," said the analyst, who asked not to be identified.
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Net charge-offs, a measure of costs for bad debt, decreased by 8 percent to $908 million, the bank said.
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This concrete commitment to address the level of bad debt is making some analysts positive ahead of the stress tests.
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Importantly, bad debt levels at the four lenders stayed below the total national non-performing loan ratio of 1.86 percent.
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Despite its aging population, excess capacity and bad debt problems, China has become the second-largest economy in the world.
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Career Education had already written most of it off as bad debt, it said in a regulatory filing on Thursday.
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The 11 are barred from lending unless they reduce their bad debt levels, improve their capital ratios and become profitable.
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"The steel ministry has found an innovative way of clearing the bad debt by ensuring procurement," said one of the sources.
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Under Rajan, the RBI has pushed for increased recognition of bad debt by state-owned lenders, hitting profitability in the sector.
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But some analysts say lenders often mask the true level of bad debt and so the figure is likely much higher.
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Provisions for bad debt rose 38 percent quarter-on-quarter to 298 million euros from 217 million in the second quarter.
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Provisions for bad debt fell 19 percent quarter-on-quarter to 247 million euros from 304 million in the fourth quarter.
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To digest some of the rising tide of bad debt, both ICBC and BoC plan to issue NPL asset-backed-securities.
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It fails to distinguish between good and bad debt and doesn't address Africa's debt levels on a country-by-country basis.
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In the next three years the banks more than tripled reserves even as they wrote off huge amounts of bad debt.
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European businesses are increasingly anticipating a recession in the near future as bad debt losses showed a marked increase in 22018.
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ATHENS, Aug 31 (Reuters) - Greece's National Bank (NBG) turned loss-making in the second quarter after booking higher bad debt provisions.
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But as the bloc's economy recovers, the amount of bad debt is slowly receding, the European Commission said in a report.
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Given the amount of bad debt coming down the pipeline, at least the pipes themselves seem to be in reasonable shape.
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Most major Thai banks reported weaker-than-expected quarterly earnings as they booked weak loans and high provisions for bad debt.
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Provisions for bad debt rose 38 percent quarter-on-quarter to 298 million euros from 217 million in the second quarter.
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Provisions for bad debt fell 26.5 percent quarter-on-quarter to 257 million euros from 349.7 million in the second quarter.
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How lenders deal with the bad debt piling up on their books is the most urgent question hanging over Chinese banks.
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Provisions for bad debt rose 18 percent quarter-on-quarter to 304 million euros from 258 million in the third quarter.
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Bad debt can now be sold to any legal entity, including foreign investors, without them needing a licence for debt trading.
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Many of Iran's banks are still struggling after piling up bad debt during the more than a decade-long sanctions era.
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Several companies challenged the circular in court arguing the time given by the central bank was insufficient to tackle bad debt.
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Italian banks are saddled with about 350 billion euros ($380 billion) of bad debt, a third of the euro zone's total.
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This is because some of the banks and NBFCs are laden with bad debt which has affected their ability to lend.
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The Melbourne-based bank had guided for flat bad debt provisions, after a major decline in unperforming loans in the institutional division.
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At one point he bought the bad debt of people who'd been ensnared by scammy payday loans so he could forgive it.
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Provisions for bad debt eased 6 percent quarter-on-quarter to 295 million euros from 314 million euros in the second quarter.
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Economists say the Turkish economy is headed for a hard landing and banks are likely to see a spike in bad debt.
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VEB has been grappling with a mountain of bad debt after projects in Russia such as construction for the Sochi Winter Olympics.
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Margins continue to be challenged as Avon invests back in advertising and contends with significantly higher bad-debt expense out of Brazil.
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The amount of soured loans surged last year after a clean-up order by the regulator brought more bad debt to light.
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Italy could seize this moment to create a single entity to help the banks sell their bad debt, and accelerate bankruptcy reforms.
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Banks and financial institutions, a key source of funding for Indian companies, hold over $146 billion of bad debt, according to Reuters.
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The statement from the official comes a day after the Supreme Court quashed a central bank order on resolving bad debt cases.
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Concerns about labor unrest, combined with worries that closing factories will saddle China's big banks with bad debt, have slowed factory closures.
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Italy's banks are still dealing with the bad debt left by the last downturn and another would risk new loans turning sour.
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"It will depend on whether there is any deterioration in bad debt and on their liabilities to the mining sector," he said.
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Yes, but: The home health industry argues that margin is misleading and doesn't account for marketing, technology, bad debt and other costs.
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Get rid of really bad debt If you have credit card debt, aim to get it paid off as soon as possible.
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But "it must be clear that no reasonably conceivable measure can cancel at a stroke the stock of bad debt," he said.
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Banks, already struggling with bad debt, will have to lend at lower interest rates to support companies struggling because of the outbreak.
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The bulk of what he owes falls into the "bad debt" category: auto loans, personal loans, credit card bills and payday loans.
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Italy could seize this moment to create a single entity to help the banks sell their bad debt and accelerate bankruptcy reforms.
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The banking watchdog changed loan classification regulations last week in another step to clean up bad debt following last year's currency crisis.
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Yet credit rating agency Moody's sees scope for as much as 40 billion euros of bad debt to be sold through the programme.
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Bad debt inherited from the financial crisis are tying up capital and curbing fresh lending in countries such as Italy, Greece and Portugal.
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Slower NPL formation is due more to how banks are recognizing bad debt than to the actual health of assets, some analysts said.
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"Bad debt consists of consumer loans to finance your lifestyle like auto loans, furniture loans, credit-card debt and payday loans," he added.
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The huge pile of bad debt has hurt the bottom lines of state-run banks and hindered their ability to issue new loans.
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Bad debt may be socialised and other tools employed over time - including offsetting risks through capital market issuance - to help the resolution process.
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ICBC, CCB and AgBank also reported declines in their non-performing loan (NPL) ratios, as they dispose of more of their bad debt.
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The pool, dubbed Arctos, includes sour credit card and consumer loans and is part of efforst to shrink the bank's bad debt load.
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Banks are a key source of funding for Indian companies and as their levels of bad debt grew, their lending capabilities were reduced.
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In the past decade state-lending booms in Brazil, India and China have enriched well-connected moguls—and built mountains of bad debt.
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He also disagrees with the view that Chinese banks are untouchable investments because of the country's problems with high leverage and bad debt.
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Alpha said provisions for bad debt fell 26.5 percent quarter-on-quarter to 257 million euros from 349.7 million in the second quarter.
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The Thai banking sector has been hit by the country's sputtering economy, which has led to slower lending growth and higher bad debt.
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Lannan labels "bad debt" as any expense that involves taking money from our future self to spend more dollars than we have today.
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The Sydney-based lender doubled bad debt charges in the first half to a six-year high of A$667 million ($514.59 million).
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The trend is expected to accelerate this year because unpaid bills are creating massive bad debt for even the most prestigious medical centers.
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"We call this the 'debt fireball method,' and that's where we attack the highest interest rate debt first, the bad debt," Anastasio says.
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Documents claiming a worthless securities loss or bad debt deduction should also be saved for seven years after you file your tax return.
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ITALIAN MODEL The plan is similar to Italy's GACS model to help lenders offload bad debt by wrapping it into asset backed securities.
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Generally, there is "good debt," such as a mortgage or car loan with relatively low interest rates, and "bad debt," like credit cards.
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It booked 20193 billion euros in loan writedowns in the period to pave the way for a 17.7 billion euro bad debt sale.
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Italy's banking index has lost half its value so far this year on worries over political instability and how to its handle bad debt.
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SCB, like other major Thai banks, was hit by the country's sluggish economy, which led to slow lending growth and rises in bad debt.
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It coaxed healthier banks into setting up an emergency fund called "Atlante" to buy bad debt and subscribe to capital hikes at struggling lenders.
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The economy is still struggling - growth is close to zero, the jobless rate exceeds 27 percent and many banks face mountains of bad debt.
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The bad-debt write-down, restructuring costs and other bits and bobs will partially offset the gains from these sales and the rights issue.
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The crisis chopped nearly 30% off the value of the lira and sent Turkish inflation soaring above 25%, leaving banks saddled with bad debt.
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"We believe that we are at the early stage of the process and that bad debt accumulation is significant and still rising," he said.
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Banks have been under regulatory pressure to tackle the bad debt problem, which restricts their ability to expand credit and help the economy's recovery.
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A downturn in growth could worsen bad debt problems in the banking sector, which the International Monetary Fund has warned could destabilize the economy.
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The industry is riddled with bad debt as there is no formal mechanism for claiming from gamblers in China as casino debts are illegal.
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Without the write-offs and with the incremental bad debt the pile may have ballooned to nearly $175 billion by the end of June.
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Under Rajan's successor Urjit Patel, the RBI tightened regulation last February, which stopped banks from using loan restructuring schemes to delay recognizing bad debt.
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Banks have been under regulatory pressure to tackle the bad debt problem, which restricts their ability to expand credit and help the economy recover.
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The stock-for-debt swap is taking shape as Hong Kong financiers say that China's bad debt problem has worsened appreciably in recent weeks.
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Inside the E.C.B., there is widespread dismay that, despite a benign economy and record-low bad debt charges, banks still can't make good profits.
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The CBRC also asked banks to accelerate their disposal of non-performing loans, investigate innovative ways to handle bad debt and diversify their methods.
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Inaction on the bad debt through the spring and summer frustrated the government, which itself was not willing to put money on the line.
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The utility, once a monopoly, reported losses of 103 million euros last year, as bad debt provisions more than doubled to 871 million euros.
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The issue really is a challenging environment, (it's) a bit subdued so not a lot of revenue growth... and that problem with the bad debt.
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Its misfortunes are a reminder that even as banks' bad debt numbers stabilise, there remain many question marks over the quality of their balance sheets.
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MashreqBank's bigger rival Emirates NBD reported a three-fold rise in impairment charges, partly hurt by bad debt charges at its newly acquired Turkish lender.
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Greek banks have been under regulatory pressure to tackle the bad debt problem which restricts their ability to expand credit and help the economy's recovery.
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DBS said bad debt charges more than doubled to S$366 million as a result of the net charges of S$150 million for Swiber.
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The bad debt situation has shown signs of improvements through recent bank earnings reports as well as resolutions happening under India's insolvency and bankruptcy act.
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Although delinquency and default rates remain near historic lows, as do industry reserves and charge-offs for bad debt, banks have started to pull back.
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Italy's banking system is the weakest among the large EU countries, with its lenders saddled with around 360 billion euros ($400 billion) of bad debt.
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"NMG MAKES Ksh1.6bn profit before tax for 2018, down 16.4pc mostly due to bad debt by the government," the newspaper, owned by the company, reported.
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He had also strongly advocated cleaning up the bad debt held by Indian lenders to revive an economy suffering from a lack of private investments.
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Public sector lenders are said to have the highest exposure to bad loans, and experts have said the sheer volume of bad debt remains high.
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Official figures put China's bad debt at Rmb4.6 trillion as of end-March, or 1.75 per cent of total commercial banking debt in the system.
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India's soured loans hit a record $145 billion at the end of June, with state-run banks accounting for the majority of the bad debt.
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Loans harks in Singapore have also adopted other methods of harassment, such as notifying a borrower's neighbour of bad debt, in order to embarrass them.
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The group, with a current market value of 2.07 billion euros, said bad debt provisions were flat at 259 million euros in April-to-June.
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The bank last week reported a 10.5 percent rise in first-quarter net profit, above analysts' forecasts as bad debt charges fell and fees rose.
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China's banking regulator last October amended regulations, allowing each province to set up two local AMCs, from one previously, to handle rising bad debt nationwide.
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China's banks have long traded below book value, as investors worried they were underplaying their bad-debt problem, and were too in thrall to Beijing.
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Banks making provisions for bad debt are reluctant to issue new loans, leading to criticism within the sector and complaints from smaller businesses and politicians.
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UAE lenders are seeing rising bad debt charges as they navigate a property downturn notably in Dubai, which has hit contractors and real estate firms.
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The group, with a current market value of 878 million euros, said bad debt provisions rose 20 percent quarter-on-quarter to 312 million euros.
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"We call this the &aposdebt fireball method,&apos and that&aposs where we attack the highest interest rate debt first, the bad debt," Anastasio said.
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VEB, aside from being under sanctions, has been grappling with bad debt after financing politically expedient projects such as construction for the Sochi Winter Olympics.
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They have said they need more money, mostly to cover losses from planned bad debt disposals, and that they may turn to the state for support.
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Banking sector reforms are a major plank of Prime Minister Narendra Modi's government's plans to revive lending which has slowed as banks struggle with bad debt.
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DBS also released its third quarter earnings, where it booked a flat on-year net profit amid a rise in bad loans and bad debt provisions.
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The loss included 4.4 billion yuan of bad debt reserve for account receivables from LeEco units and 3.5 billion yuan of asset devaluation provision, it said.
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Bad debt weighs on banking balance sheets and holds back lending, countering the very stimulus the ECB is trying to provide with rock bottom interest rates.
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The RBI guidelines, issued in a circular released in February last year, said lenders could no longer use loan restructuring schemes to delay recognizing bad debt.
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State-controlled Huarong is among the Big Four bad debt managers created in 1999 to take over distressed assets from China's Big Four state-owned lenders.
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On bad debt, he said, it is more important that banks manage that risk by "proactively and conservatively" setting aside enough money to cover those loans.
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The ECB is right to target European lenders' 840 billion euro mountain of bad debt, but its clumsy move may end up slowing down its effort.
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Government spending and rising energy prices would help spur an increase in loan demand while lower provisions for bad debt should support earnings, sector analysts said.
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Italian banks, weighed down by about a 360 billion euro ($400 billion) bad debt and falling share prices, are also likely to be on Draghi's agenda.
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The bank's bad debt is expected to decrease by 0.2 to 0.3 percentage point this year from last year's 3.23 percent of total lending, Oranuch said.
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UniCredit, however, said it will instead move its bad debt into two special purpose vehicles, controlled by U.S. bond house Pimco and hedge fund Fortress Investments.
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C: So the bank has spent the last few years winding down its bad debt, NPLs have come down from its peak of 3.7% in 2013.
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Many analysts believe the real bad debt burden at China's banks is much higher, but even the official figures show a sharp rise in troubled loans.
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Bad debt was 2.48 percent of overall loans at Tianjin, and 20173 percent at Tianjin Binhai — higher than the national level of 1.74 percent for 2017.
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Huarong is among the Big Four state-owned bad debt managers, created in 1999 to take over distressed assets from China's Big Four state-owned lenders.
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The central bank said both Tsesnabank and Eurasian Bank had received state support last year under a programme of capital injections aimed at reducing bad debt.
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Now with its 10-year Treasury rate at 1.82 percent, no one cares, even if the country's banks have 360 billion euros in bad debt overall.
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Mr. Zhou indicated that under the proposal described on Saturday, the bad debt would be sold to institutional investors rather than being held by the banks.
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In fact, even as India's state-owned banks are holding bad debt of about $186 billion, Mr. Modi's government has hesitated to go after big defaulters.
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Italy is worried the new rules would be applied to the euro zone's $1 trillion bad debt mountain, a quarter of which sits at Italian banks.
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The central bank's move represented the latest in a series of negative headlines for India's banking industry, that is struggling with a mountain of bad debt.
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A key factor has been the lack of private investment as state banks, which provide most of the credit, hold the largest amount of bad debt.
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Over the last two years, many Chinese banks have struggled to record even 1 percent growth in profits due to soaring bad debt and loan defaults.
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VTB's cost of risk, which relates to the level of bad debt provisions, fell to 0.9 percent from 1.9 percent in the first quarter of 2017.
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Weighed down by bad debt often a decades old, many lenders remain reluctant to lend to the real economy while they struggle to repair their balance sheets.
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Economic integration means that financial crises can quickly spread; just as American subprime mortgages hit the world in 2008, Chinese bad debt may do so in future.
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Piraeus Bank plans to sell 483 billion euros in bad debt, half in the form of unsecured consumer loans, a senior banker involved in the process said.
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India's state banks have been struggling with high levels of bad debt on their balance sheets, which prompted authorities to step in and clean up the sector.
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In February 2007 Britain's HSBC shocked markets by raising its bad-debt provisions to $10.5bn, $1.8bn more than analysts had expected, because of failing American subprime mortgages.
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"Overall, the result was slightly stronger than expected driven by higher non-interest income and lower bad debt charges," Regal Funds Management Senior Analyst Omkar Joshi said.
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RBI's Rajan, who wants banks to fully disclose and provide for bad debt by March 13, is calling for "deep surgery" to clean up the balance sheets.
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One problem facing hospitals is that they lost the "disproportionate share payments," akin to a bad debt or charity pool, under the Affordable Care Act, Davis noted.
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Like other major Chinese banks, it is seeing margins squeezed by the central bank's successive rate cuts and profitability and capital buffers eroded by rising bad debt.
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Lou said the level of non-performing loans at banks was expected to rise "mildly", when asked about rising bad debt levels in relation to structural reform.
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But there are headwinds from rising oil prices, a banking system still clogged up with bad debt, and financiers' unwillingness to make any but the safest loans.
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The lenders, like any financial services institution facing increased bad debt, raised funds to bolster their balance sheets and to continue expanding corporate and retail lending businesses.
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Bad debt charges for the quarter rose slightly to A$216 million for the quarter but remained at 11 basis points of all loans, the bank said.
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The increase in bad debt and loan defaults are major challenges that China's banking system has been grappling with over the past years amid slowing economic growth.
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Turkey's banks face a potential deluge of bad debt as the lira sell-off has driven up the cost for companies to service their foreign currency loans.
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They are not allowed to buy fabricated debts or assets, or provide financing for companies or projects in the name of bad debt purchases, the CBRC warned.
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India's top court had quashed a Reserve Bank of India (RBI)circular on resolving bad debt on Tuesday, throwing the country's still-nascent bankruptcy regime into question.
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Italian bank shares have tumbled this year, overshadowed by a 238 billion euro ($21 billion) bad debt mountain that the banks accumulated during a three-year recession.
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That is not good for banks—and Italy's, labouring under the EU's heaviest bad-debt burden and tied to a frail economy, have been walloped (see chart).
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Avon, which has a market value of $1.59 billion, on Thursday reported a surprise first-quarter loss partly due to higher bad debt expense, mainly in Brazil.
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Tenda appears to have cleaned up bad debt receivables from past projects and most contingency provisions have ended, Bradesco BBI analysts wrote in a note last week.
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Zhu's comments were backed by the top four banks' latest quarterly report cards, which all showed a decline in the proportion of bad debt to total loans.
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Global rating agency Moody's said the judgment was credit negative for Indian banks and warned it could further delay the resolution process of bad debt in India.
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While bad debt charges are rising, Australia's major banks have small exposures to mining and mining-related services and their total loan losses are near record lows.
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There are distinctions to be made between "good debt" and "bad debt," but the greatest impact of all may be whether you manage whatever you borrow effectively.
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"We go to their houses with oranges or mangosteens," Piya, who runs one of the growing number of firms in Thailand seeking profits from recuperating bad debt.
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BUT I ALSO READ A REPORT YESTERDAY THAT SUGGESTED THAT CONSUMER BAD DEBT WAS UP BY 20% IN THE CREDIT CARDS FOR FOUR MAJOR BANKS, INCLUDING YOURS.
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Uncertainty over the health of the nation's banks, plagued with 22015 billion euros, or about $2200 billion, in bad debt, has also been rattling global financial markets.
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The currency slump has driven up the cost of servicing that debt and investors fear that banks could be hit by a wave of rising bad debt.
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Selling and administrative expenses increased 28.4 percent to $424.6 million, mainly due to bad debt expense related to the Toys 'R' Us liquidation, severance and restructuring costs.
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Corporations and banks are undergoing a balance sheet deleveraging cycle to clean up bad debt from their books, Varma told CNBC's "Street Signs" before the RBI's decision.
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He argues that the bulk of Italy's bad debt is backed by collateral and most of the remainder has a solid chance of turning into collectible debt.
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Foreign investors have often complained about the slow pace of bad debt resolution in India, which has held back billions of dollars of investment in the country.
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The danger of fraudulent collateral in this situation, say economists, is that it exacerbates the problem of bad debt for China's banks, increasing the risk of financial turmoil.
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The lukewarm start for the last of China's big banks to go public comes as investors keep a weather eye on bad debt piling up at Chinese banks.
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Earlier this week, Rome reached a compromise deal with the European Commission over a government guarantee scheme to help banks offload at least some of the bad debt.
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Atlante, a private bank-rescue fund set up at the government's behest partly to kick-start a bad-debt market, has not raised as much capital as hoped.
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The RBI has barred these banks from lending under the so-called prompt corrective action plan until they improve their capital ratios, reduce bad debt and become profitable.
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A mountain of bad debt in India's banking system has led to a prolonged credit crunch that has been inflicting most pain on small- and medium-sized enterprises.
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ATHENS, March 15 (Reuters) - Greece's National Bank (NBG) on Tuesday reported a loss in last year's final quarter as higher bad debt provisions weighed on its bottom line.
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They completed 13 GACS-backed deals in 2018, using the scheme to shed some 44 billion euros in bad debt, according to bad loan data group Credit Village.
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Fitch estimates Indian banks will need about $90 billion in new capital to tackle bad debt and meet global Basel III banking rules taking effect in March 2019.
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Bad debt rose as huge loans to sectors such as infrastructure came undone after sections of the economy came to a standstill following the 2008 global financial crisis.
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Italy's outgoing finance minister Pier Carlo Padoan welcomed the commission's proposal on Tuesday, telling a news conference in Brussels that it would make sales of bad debt easier.
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The company, which provides loans, wealth management and securities trading services, said its net interest margin and bad debt ratio were in line with the last financial year.
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Sources told Reuters late on Thursday that China plans to ease banks' bad debt burden by allowing them to swap non-performing loans (NPL) for equity in borrowers.
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Currently, local AMCs, constrained by their smaller capital base, only take 5 percent of the bad debt market, while the Big Four AMCs control 95 percent, Lai said.
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Foreign investors have often here complained about the tardy pace of bad debt resolution in India, which has held back billions of dollars of investment in the country.
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Indian banks and financial institutions hold bad debt of over 10 trillion rupees ($150 billion) and this has affected their ability to lend and also spur economic growth.
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GDP grew 6.0% last quarter, but credit growth disappointed as campaigns to cut bad debt while pushing banks to lend to risky small firms resulted in financial muddle.
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But the plans for the financial sector rattled investors as industry leaders said they could stall a clean-up of bank bad debt and derail a tentative recovery.
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ATHENS (Reuters) - Greece secured on Thursday approval from the European Commission to a plan to help Greek banks offload part of their bad debt, the finance ministry said.
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Bad debt charges rose 7.4 percent from Sept-end to A$375 million, mainly on account of four Australian corporates coupled with charges for New Zealand dairy sector.
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Although many economists saw that slide in PMI as temporary, some warned that growth prospects for the year were still dampened by soaring bad debt in the economy.
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Its banking division posted a 13 percent rise in adjusted operating profit to 122.7 million pounds, driven by strong net interest margin and low provisions for bad debt.
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Provisions for bad debt more than doubled quarter-on-quarter to 664 million euros, including a charge of 443 million related to an asset quality review conducted last year.
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The banking system has been weak for years as most institutions have failed to deal with the high level of bad debt in the wake of the financial crisis.
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He added that "one or two" Greek banks had suffered due to contagion from Italy, but said their problems were also caused by very high levels of bad debt.
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Provisions for bad debt fell 62 percent from the previous quarter to 255 million euros, while the cash coverage of the bank's non-performing loans rose to 70 percent.
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But there is a key reason why MSCI may stand pat, according to to Richard Martin, executive vice president at IMA Asia: bad debt piled up by China's companies.
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S&P research estimated that if this crisis is prolonged, bad debt in the banking system could increase from 2% at the end of last year to over 6%.
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The breakthrough is expected to help India tackle its mounting bad debt problem after two of the country's largest lenders provided unprecedented guidance on non-performing loans last month.
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Jean-Pierre Mustier, the newish French boss of UniCredit, is knocking the biggest bank into shape, writing down bad debt by €8.1bn, selling assets and raising €13bn in equity.
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Partly because of central government pressure to fix the bad debt issue, banks are reporting a 54.6 per cent higher bad loan loss figure compared to a year ago.
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ICBC also took the lead in testing the government's regulatory line by lowering its bad debt provision level to 136 per cent, down from the previous 143 per cent.
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In contrast, Australia and New Zealand Banking Group Ltd , which last week warned about increasing bad debt charges due to a downturn in the resources sector, fell 0.5 percent.
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Beijing wants the country's commercial banks to help fund infrastructure spending to support cooling growth, but isn't relaxing a campaign to cut a $290 billion pile of bad debt.
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The lender reported a 4 percent rise in its half-year cash earnings from continued operations, helped by a sharp fall in bad debt charges and expenses declining marginally.
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Finance Minister Arun Jaitley on Tuesday blamed the central bank for failing to stop a lending spree during 2008-2014 that left banks with $150 billion of bad debt.
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The banking group said on Friday its IFIS NPL unit had bought three portfolios of bad debt from UniCredit, Deutsche Bank and an Italian consumer credit company in September.
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ANZ disappointed investors after it flagged bad debt charges of more than A$900 million ($674.28 million) for first-half 2016, A$100 million more than its previous guidance.
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If millions of Americans lose or drop their coverage, we will see a jump in bad debt and uncompensated care -- that is care for which we receive no payments.
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Federal rules require charges that cannot be collected from families to be written off as bad debt that must be covered by funds outside of the school nutrition programs.
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And if China's recent record is any guide, pump-priming may result in wasteful projects and even bigger piles of bad debt that could end up throttling the economy.
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Turkey's banks face a potential deluge of bad debt after the lira plunged 40 percent this year, driving up the cost for companies to service their foreign currency loans.
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In that year the previous government had to pour more than 3 billion euros into Slovenian banks to prevent them from collapsing under the weight of rising bad debt.
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That not only produced an array of big, unfinished projects and bad debt, which now hobbles the state-owned banks, but also opened the door to large-scale corruption.
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India's state-run lenders are struggling to clean up bad debt in their portfolios at a time when they face hefty capital requirements to meet upcoming Basel III rules.
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It is the latest in a series of tactics employed by the country as it tries to pare bad debt, which by some analysts' estimates has reached epidemic levels.
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The reported system NPL ratio was 2.55% at end-March 2017, but this did not take into account banks' bad-debt sales to the Vietnam Asset Management Company (VAMC).
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Monte dei Paschi, which is burdened by a mountain of bad debt, needs to complete the share sale by the end of the year to avoid a state bailout.
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A draft law currently being debated in parliament removes some obstacles to dealing with the bad debt by introducing tax exemptions for loan restructuring and legal protection for bankers.
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"You don't get this massive uptick in utilization, and on top of that, you have problems with bad debt," said Spencer Perlman, a health care analyst at Height Securities.
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However, the slow-moving nature of Italy's judicial system means that sales of bad debt remain the most expeditious option, though lenders usually make a loss on such deals.
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In the first disposal of a large portfolio at book value, Intesa Sanpaolo this week shed 11 billion euros in bad debt at 29 percent of its face value.
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Beijing, trying to slash a $310 billion pile of officially recognised bad debt, is pushing giants like China Construction Bank to help troubled smaller rivals, or rescue them outright.
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The Nikkei said that bad debt tied to such cash advances climbed 13 percent to a six-year high of roughly 140 billion yen ($67623 billion) in fiscal 2017.
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Bad debt hit 9.46 trillion rupees at the end of September 2017, accounting for 12.2 percent of total loans, Reuters reported, citing "unpublished central bank data" that it viewed.
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The Nikkei said that bad debt tied to such cash advances climbed 13 percent to a six-year high of roughly 140 billion yen ($1.27 billion) in fiscal 2017.
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But although NBG, Greece's second largest lender, said it was profitable for a third straight quarter, net earnings fell sharply in the period as its bad debt provisions rose.
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Racking up credit card debt by shopping for clothes or dining out and not paying off the balance at the end of the month is an example of bad debt.
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Authorities are now discussing how to deal with tens of billions of dollars of bad debt, but efforts to address the problem have been slowed by its cost and complexity.
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It's also why remaining in a collapsing tower of bad debt will guarantee a far worse economic outcome and catastrophic confrontations between Europe's ever narrowing core and ever widening periphery.
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ATHENS, March 30 (Reuters) - Greece's second largest lender by assets National Bank (NBG) was profitable for a second straight quarter in October-to-December, helped by lower bad debt provisions.
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The group, with a current market value of 53 billion euros, said bad debt provisions rose to 310 million euros in October-December from 242 million in the third quarter.
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Companies reported 2.31% in bad debt losses in 2018 as a share of total revenues, an increase from 1.69% in 2017, according to a report from Swedish debt purchaser Intrum.
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Guo said the dangers stem from the pressure of rising bad debt, imperfect internal risk systems at financial institutions, the relatively high levels of shadow banking activities and rule violations.
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Banca Carige has picked Credit Suisse, Deutsche Bank and Goldman Sachs as advisers for an upcoming capital increase and planned bad debt sales, it said in a statement on Friday.
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Those included asset quality reviews to make sure all bad debt was declared, recapitalizing the public-sector banks, consolidating smaller banks, and introducing reforms for many of their lending practices.
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Italy, which has one of the highest rates of non-performing loans in Europe, struck a deal with the European Commission to help its banks sell off their bad debt.
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Deterioration in the operating environment, which would result in a substantial inflow of new bad debt and capital erosion at the four banks, could lead to downgrades of their VRs.
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Earlier on Tuesday, a source told Reuters the ECB would give the banks it supervises a target date to fully provision for all of their bad debt, existing and new.
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CRISIL, however, said the Supreme Court's decision will not have a significant impact on new bad debt accretion levels as most of them have been recognized by the banking sector.
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The four largest banks, which together control about 80 percent of the country's home loan markets, have boosted profits on the back of low bad debt charges in recent years.
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The total amount of bad debt held by Italian banks fell by 2.1% in July to €503bn ($250bn), the biggest monthly decrease since figures started to be compiled in 2000.
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The proportion of bad debt to total loans in Chinese commercial banks stayed steady at 1.74 percent at the end of September, unchanged from the second quarter, official data showed.
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The magnitude of the bad debt in India forced the government last year to bail out the sector by pledging to inject $32 billion over this financial year and next.
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Evidence of an improved operating trend would include sustained positive growth in organic patient volumes, improvement in the payor mix with fewer uninsured patients and correspondingly lower bad-debt expense.
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"Asset quality remains the key focus," said Nick Koskoletos an analyst at Eurobank Securities, adding investors were watching to see if banks would hit 2019 targets for bad debt levels.
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Indian banks and financial institutions currently hold total bad debt of over 10 trillion rupees ($146 billion) and this has also affected their ability to lend and spur economic growth.
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Bad debt expense began stepping up in 2Q16, significantly exceeding 1% for the first time in several years, driven primarily by a higher default rate among new and infrequent customers.
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Atlante manager Alessandro Penati has said he plans to raise more money from investors to buy Italian banks' problem loans but only after successfully completing a first bad debt deal.
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China Cinda Asset Management's 5.625% 2024s were under pressure, down a third of a point, after the bad-debt manager announced a mandate for a US dollar offering this morning.
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Moody's expects defaults on junk bonds to rise, but even its worst-case scenario envisions a smaller spike in the share of bad debt than during the 2008 financial crisis.
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Mulberry said it had faced bad debt and fixed asset write-off of 2.1 million pounds and fixed asset impairment costs of 800,000 pounds from the House of Fraser collapse.
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As for bad debt, she concedes that credit cards are convenient, but she emphasizes that you need to understand that every time you use your card you are borrowing money.
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India still has big problems like a banking sector saddled with a huge pile of bad debt "but this is most definitely a step in the right direction," he added.
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He pointed me to Signet's letter responding to the S.E.C., in which the company said recasting bad debt expense would be neither a relevant nor a meaningful disclosure for shareholders.
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And she says it persists among people who don't understand the difference "good debt" that is an investment that pays off in the long run versus "bad debt" which doesn't.
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With the reorganization, China's government will also take concrete steps to address the second of Xi's three battles -- growing concerns around financial risk and bad debt endangering the Chinese economy.
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Putting it to work in the more backwards corners of China's financial system could also aid efforts to clean up 2.4 trillion yuan ($341 billion) of officially recognised bad debt.
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Your tax-bill bonus may leave you disappointed4 steps to help you kick your bad debt habits for goodOne big way to play the new tax law: Start an LLC
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OIBDA was up thanks to a rise in profits at telecoms network operator Mobile TeleSystems, an asset revaluation at its agricultural unit, Steppe, and lower bad debt provisions at MTS Bank.
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Many banks have been hobbled by a build-up of bad debt linked to the slumping construction and energy sectors, while Erdogan has harangued the sector for not cutting borrowing costs.
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Other measures taken by the company to mitigate the downturn include being more selective in its credit policy and gaming limits to offset lower revenues with fewer bad debt write-offs.
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In a report last September, Fitch Ratings estimated that it would cost as much as $2000 trillion to clean up China's bad debt – almost a fifth of annual Chinese economic output.
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Adding to the row, Finance Minister Arun Jaitley blamed the central bank for failing to stop a lending spree during 2008-2014 that left banks with $150 billion of bad debt.
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The bad debt provisions, which have more than doubled in 2015 and are seen growing further due to tightening regulation, are now adding to the pressure on the industry to adjust.
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Genting Singapore, which owns the tropical Sentosa resort in the city-state, said its bad debt provision more than doubled quarter on quarter in the first three months of the year.
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Mortgages and student loans are often seen as "good debt," while credit card debt is considered "bad debt" because it often comes with higher interest rates, which can add up quickly.
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But even if the government and the RBI agree on creating an institution to tackle bad debt, the differences in structures under the existing plans would need to be ironed out.
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In 2018 alone, Italian banks tapped the scheme to push 44 billion euros ($49.94 billion) in gross bad debt off their balance sheets, according to bad loan data provider Credit Village.
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Qatar National Bank on Tuesday reported an almost 3.6 percent increase in second-quarter net profit, above analysts forecasts, helped by a drop in bad debt charges and lower staff costs.
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In June, Huarong said it would refocus on its core bad-debt business in a shift after years of overseas acquisitions ranging from a Hong Kong broker to a Chicago hotel.
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Lai Xiaomin, chairman of China Huarong Asset Management, the country's biggest bad debt manager, said he had no direct knowledge of the move, but would welcome such debt-to-equity swaps.
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"Bad debt worries are clearly weighing on Australian banks and the Australian share market," Shane Oliver, head of investment strategy and chief economist at AMP Capital, said in a weekly report.
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After a slow start due to the patchy state of Italian banks' loan records and its own complexity, the GACS scheme has been a key contributor to banks' bad debt sales.
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Some banks, depressed by concern about Saudi Arabia's economic slowdown and the threat of bad debt in the slumping construction sector, are trading below what analysts consider to be fair value.
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That is likely to disappoint investors who were hoping for a clear-out that would remove the overhang of bad debt for good and allow them to buy those loans cheaply.
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Hospitals in Southern Republican states that did not expand Medicaid said they expect the number of patients covered through the exchanges to drop if prices spike in 2018, increasing bad debt.
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Net charge-offs, a measure of costs for bad debt, increased by $12 million on a year-over-year basis to $900 million, driven by higher commercial losses, the bank said.
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He reckons China's big four banks have a lot less bad debt than the world assumes, and his fund is long on the Industrial and Commercial Bank of China (601398.SS).
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The move is the latest by the China Banking Regulatory Commission (CBRC) to ease lenders' struggle with a mounting pile of bad debt as borrowers struggle with the slowing economic growth.
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China's banks have been struggling with shrinking margins after successive interest rate cuts and growing bad debt as the country's growth rate hits its slowest stride in over a quarter century.
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Mr. Nilekani says he is concerned about the bad debt piling up on the balance sheets of banks in India, but he worries more about an increase in anti-globalization sentiment.
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China's biggest lenders are in the midst of a revival, posting faster profit growth and generally healthier net interest margins after years of rising bad debt as economic growth slowed down.
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Much of the bad debt has stemmed from a spate of defaults by SMEs in 2015 and 2016 as some struggled as a result of lower oil and other commodity prices.
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Greek authorities, seeking to help banks to clean up their loan books faster, have put together new schemes to help lenders offload bad debt by wrapping it into asset-backed securities.
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I learned about sales, gross and net margins, working capital, inventory management, and bad debt collection — all skills that would later prove important as I started real companies as an adult.
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In the same way we have stepped up to the plate with strategies for student debt, financial advisors will need to help their older clients differentiate between good and bad debt.
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Great Wall is one of the country's Big Four state-owned bad debt managers set up in 23 to purchase non-performing loans from the country's four biggest state-owned banks.
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After they leave, the damage will spread to doctors and hospitals, whose bad debt will skyrocket when patients miss copays and drop coverage while providers and hospitals still must continue care.
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Fitch analysts said that the sector has gotten better at dealing with bad debt, but they warned that progress could stall if investors are scared off by the government's economic plans.
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Funding Circle said its current loan performance remains in line with previous projections, but that there was a 'marginal' increase in bad debt expectations for loans originated in Britain in 2018.
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Shares of NCB were up 0.2 percent after it reported on Wednesday a 10.5 percent rise in first-quarter net profit, above analysts' forecasts as bad debt charges fell and fees rose.
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The National Audit Office reported this month that some banks in the central province of Henan had recorded 40 percent of their loan books as bad debt by the end of 2018.
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Still, analysts warn the tide of bad debt could rise, as some banks have not yet fully accounted for all bad loans due to using different numbers of days to calculate defaults.
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At a board meeting on Thursday, Monte Paschi acknowledged receipt of a draft letter from the ECB calling on it to cut its bad debt portfolio but it gave no further details.
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Those included asset quality reviews to make sure all of the bad debt was declared, recapitalizing the public-sector banks, consolidating smaller banks and introducing reforms for many of their lending practices.
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With nearly half of them under a PCA plan and the rest cautious due to a record $150 billion in bad debt, there is concern that their ability to lend is restricted.
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Australia's four major banks posted their sixth straight year of record profits last year but rising bad debt charges, pressure on margins as well as stricter capital rules are clouding growth outlooks.
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The oil-exporting country's banking system has been volatile since 2015 when global energy prices plunged and the local property market crashed, leaving many lenders saddled with bad debt and devalued collateral.
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Overall sales were flat in July-to-September at 991.5 million euros, with increased revenues in Greece offset by weakness in Romania where bad debt provisioning could rise in the coming quarters.
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ANZ said on Thursday said bad debt charges rose for the fourth half-year period in a row, totalling A$1.96 billion for the year, up 62 percent from the year before.
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Provisions for bad debt more than doubled from the previous quarter to 664 million euros, including 443 million related to an asset quality review that was part of the ECB health check.
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Tisco Bank's bad debt surged last year after loans related to steel maker Sahaviriya Steel Industries turned into non-performing loans (NPLs), forcing the bank to set aside higher loan loss provisions.
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That ruling had spooked bankers, who warned it could jeopardize the entire loan securitization market in the country, further straining a banking system already hobbled with nearly $140 billion in bad debt.
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A plethora of investment firms have set their sights on Co-op's bad debt and are hoping for a break-up of the Manchester-based lender into a good and bad bank.
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GST aside, New Delhi is also cleaning up debt-saddled public sector banks and it introduced a new bankruptcy law late last year to resolve the nation's $150 billion bad debt overhang.
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Europe, while things are improving, there was so much bad debt among financial institutions and the banks, and even though that was a number of years ago, we're still finding opportunities there.
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But the bad debt market is still dominated by the "Big Four" AMCs - Huarong, Cinda, Great Wall and Orient, set up in 1999 to clear up bad loans at state-owned banks.
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HKEX chief executive Charles Li has banked on deepening the bourse's ties with mainland China to sustain profit growth, despite fears over the Chinese economy which is saddled with rising bad debt.
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VEB is under Western sanctions over the Ukraine conflict and has been grappling with a mountain of bad debt after financing politically expedient projects such as construction for the Sochi Winter Olympics.
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While there is so-called "good" debt and "bad" debt, according to some financial planners, debt with high-interest rates (namely: credit cards) can be a wealth killer if not managed wisely.
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A "bad bank" also wouldn't be able to fix another problem in the system: India's weak judiciary is keeping companies from swiftly declaring insolvency, and so letting bad debt fester for longer.
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UAB and CBI have been cleaning up their balance sheets since before the regional dispute began, after a build up of bad debt, mainly from SME customers hit by a soft economy.
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Wake Forest Baptist Medical Center in North Carolina had seen its bad debt creep up in recent years as more patients saw out of pocket expenses soar, with some deductibles reaching $15,000.
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Banca Monte dei Paschi di Siena's rescue has already received the green light from Brussels, but it needs to find investors to shift 26 billion euros of bad debt off its books.
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ANZ booked a more than doubling in bad debt charges to A$918 million, while adding it continued to see "pockets of weakness" associated with low commodity prices in the resources sector.
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HANOI, March 6 (Reuters) - Several banks in Vietnam have seen their bad debt ratios rise as their clients face liquidity issues due to the coronavirus epidemic, the Vietnamese government said on Friday.
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Emirates NBD saw impairments rise more than three times, partly due to bad debt charges at its newly acquired Turkish unit, DenizBank, while similar charges climbed 23.6728% at Abu Dhabi Commercial Bank.
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Turkish companies, mostly in the construction and energy sectors, have struggled to service bad debt lingering on banks' balance sheets, which represents one of the worst hangovers from last year's currency crisis.
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Stability plans included successfully resolving the bad debt problem in India's public sector banks, stabilizing the goods and services tax implementation, and managing risks around higher oil prices and asset price corrections.
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An ongoing bad debt problem in India has been brewing since 2012 when banks expanded lending at a fast pace, including to a number of problematic sectors such as telecommunications and mining.
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Italian banks completed 13 GACS-backed deals in 2018, shedding a nominal 44.3 billion euros in bad debt, or 42 percent of total sales, according to bad loan data group Credit Village.
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ISTANBUL (Reuters) - A draft law submitted to Turkey's parliament introduces tax exemptions to loan restructurings and legal protection for bankers as Ankara tries to make it easier for banks to restructure bad debt.
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The decline in the lira has driven up the cost of servicing dollar and euro loans that Turkish companies have built up for years, raising the possibility of ballooning bad debt for banks.
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For instance, it provides insurers with preventive solutions, applying big behavioral data and machine learning to generate the best predictions on default, bad debt, prepayments and customer churn resulting in individualized risk assessment.
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Plagued by bad debt and scarce demand, the sector will only begin to revive when inflation falls to 10% from above 22.3% now, and housing credit rates drop to 23-21.7%, Tugsuz said.
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In the construction and energy sectors alone, there is some $21 billion in bad debt, and Reuters reported last month that plans have been delayed to safely move it off banks' balance sheets.
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It also recognised an impairment provision of 2 million pounds related to a debt from its Indian licensee and an 800,000 pound bad debt provision due to House of Fraser going into administration.
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These non-bank finance companies have played a major role in lending growth in India in the last two years, as Indian banks, saddled with roughly $150 billion of bad debt, slowed lending.
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Down Under, banking stocks closed mixed Wednesday, after the country's so-called Big Four banks sold off sharply on Tuesday on concerns over potential bad debt from their exposure to the resources sectors.
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That followed ANZ's warning last week that it would see higher bad debt charges than previously expected on its exposure to the resources sector, which spurred concerns that other banks faced similar issues.
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Italian banks, weighed down by about a 360 billion euros ($400 billion) in bad debt and falling share prices, are also a headache for the ECB, which is the euro zone's bank supervisor.
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The CBRC also asked its local offices to strengthen its offsite and onsite inspection of bad debt companies, taking regulatory measures to address "illegal conduct" and holding related personnel responsible, the document said.
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While bad-debt charges are still at a low level, analysts are hoping an improvement in Australia's hard-hit property markets in the past two months flows through to the bank's loan portfolios.
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The ECB has made tackling non-performing loans, which are curbing a recovery in lending, one of its priorities for 2016 and launched a review of how banks should deal with bad debt.
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Plagued by bad debt and scarce demand, the sector will only begin to revive when inflation falls to 22019% from above 21% now, and housing credit rates drop to 22.3-23%, Tugsuz said.
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In the construction and energy sectors alone, there is some $2000 billion in bad debt, and Reuters reported last month that plans have been delayed to safely move it off banks' balance sheets.
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Investors also took solace from largely stable asset quality after ANZ said its third-quarter individual bad-debt charge of A$1.34 billion was in line with the average of the first-half.
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Impaired loans had fallen significantly at end-0003H17 to 8.7% of total gross loans from 16.3% at end-1H16, following accelerated bad debt sales in the commercial real-estate and residential mortgage segments.
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BRUSSELS (Reuters) - European Union finance ministers on Tuesday called for speedier unloading of bad debt by EU banks and recommended more money be put aside by the banks to protect them from trouble.
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The largest publicly-traded hospital chain, HCA Holdings Inc, reported in the fourth quarter of 2016 that its ratio of bad debt to gross revenues of more than $11 billion was 7.5 percent.
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"Just having a lot of debt, and bad debt, does not cause you to have a crisis," said Arthur R. Kroeber, the managing director of Gavekal Dragonomics, an economic research firm in Beijing.
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Kit Juckes, a strategist at Societe Generale, points out that the 2008 meltdown was a result of banks who held excessive amounts of bad debt and relied too much on short-term funding.
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BNP Paribas last week also warned that Italy still poses a political risk to the eurozone, with investors overlooking the country's high government debt and ongoing bad debt problems in the banking sector.
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Don't worry about that part of the reimbursement, don't worry about that part of the collection process, don't worry about bad debt attached to that, we want to support you from that standpoint.
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For example, while borrowing to fund your education is good debt — because "it's an investment in yourself and your future" — it can easily move into the bad debt category, as many have learned.
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Its shares dropped as much as 5.7 percent to a three-week low after it reported a 3 percent rise in first-half cash profit, which missed forecasts as bad debt charges rose.
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The decision affirms a 2018 ruling by a federal judge in Houston, who rejected Baker Hughes' argument that the money was deductible as a bad debt or an ordinary and necessary business expense.
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Property developers are increasingly willing to indulge and attract buyers in a slow real estate market dented by a liquidity crunch in the shadow-banking sector and bad debt woes at state-run banks.
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It has recently proposed tougher provisioning guidelines on new NPLs and said it would come up with new rules on older bad debt, drawing fierce opposition from the most affected countries, such as Italy.
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SYDNEY, Aug 11 (Reuters) - National Australia Bank on Friday said its third-quarter cash profit rose 5 percent, helped by growth in its lending arm as well as a fall in bad debt expenses.
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For Chinese lenders, the pace of bad debt build-up has shown no signs of slowing as the world's second-largest economy faces persistently weakening domestic demand and trade friction with the United States.
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Meanwhile, rating agencies have warned India will need to inject significantly more capital to tackle bad debt and meet upcoming global Basel III banking rules than the 700 billion rupees planned by New Delhi.
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The ratio of bad debt for the bloc fell below five percent last years but remains over 10 percent for Italy, Ireland and Portugal while in the case of Greece, it was 45 percent.
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The Reserve Bank of India (RBI) has barred 11 state-run banks from lending under the so-called prompt corrective action plan until they improve their capital ratios, reduce bad debt and become profitable.
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Lenders and indebted companies are looking for the states assistance in areas such as reducing restructuring costs through tax breaks and making it easier for foreign investors to acquire bad debt, three sources say.
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A recent rebound in the currency albeit modest in comparison to last years 30% slide has removed some of the urgency but the size of the bad debt remains significant, a restructuring consultant said.
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The net interest margin dipped to 8.0% from 8.2% the year before, while the bad debt ratio rose to 8.6% from 8.4%, but held well below the Kenyan industry average of 12.7%, Equity said.
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The sector is also experiencing slowing growth after years of record profits as bad debt charges tick up in an economy that is battling the end of a once-in-a-generation mining boom.
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The bank's in Asia's third largest economy have been dealing with a huge pile of stressed loans worth over $150 billion, with the state-run banks holding the vast majority of the bad debt.
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Italy's 350 billion euros of bad debt was one of last year's biggest market worries, with the Italian government forced to create a state-backed bail-out fund to tackle rising non-performing loans.
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Zhou's successor will face an immediate choice of how aggressively to continue the policy transition towards market-based norms, and how to resolve a suspected mountain of bad debt on provincial and corporate books.
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Hospitals in non-expansion states as a rule have higher levels of "bad debt," which is the cost of treating people who can't pay all or much of their bills because they lack insurance.
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Huarong, one of China's largest state-owned bad debt managers, hit the headlines this year after building up a 36 percent stake in a key unit of embattled private energy company CEFC China Energy.
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On Sunday an ECB spokesman said Frankfurt was quizzing a number of euro zone lenders about high levels of bad loans as it steps up efforts to tackle the region's mountain of bad debt.
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Kenya's main power distributor said it increased its bad debt provisions seven-fold to 13 billion shillings ($59 million) in the financial year that ended June 30 after it adopted a new accounting standard.
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Though the central bank did not give a reason for its decision, the move, according to market insiders, exemplifies the RBI's increasingly assertive approach in tackling the bad debt problem plaguing India's banking sector.
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The BOJ chief said Italian banks' non-performing loans needs to be tackled quickly but he didn't see the bad debt issue posing significant negative effects on the financial system of Italy and Europe.
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India's banking sector has struggled under crippling levels of bad debt for years, with state-run banks including PNB and larger rival State Bank of India (SBI) holding the majority of the soured assets.
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As Germany's banks continue to battle with a legacy of bad debt, bloated headcounts and fines a decade after the global financial crash, Wirecard is benefiting from the power and scalability of platform economics.
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But even if the government and the RBI agree on creating an institution to deal with bad debt, the structures differ under the existing plans, and the differences would need to be ironed out.
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Lenders and indebted companies are looking for the state's assistance in areas such as reducing restructuring costs through tax breaks and making it easier for foreign investors to acquire bad debt, three sources say.
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A recent rebound in the currency – albeit modest in comparison to last year's 30% slide – has removed some of the urgency but the size of the bad debt remains significant, a restructuring consultant said.
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Creaking under mountains of bad debt banks themselves are under pressure from the government to chase up high profile cases like Mallya, whose Kingfisher Airlines collapsed in 2013 leaving unpaid wages and angry creditors.
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It will be the country's first foreign tech I.P.O. • India's new bankruptcy law and its efforts to tackle bad debt are providing exciting incentives for investors to reconsider delving into the nation's distressed market.
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Investors are also concerned about the state of the banking sector, which faces a potential deluge of bad debt with companies' cost of servicing foreign-currency debt increasing with the decline in the lira.
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VEB is under Western sanctions over Moscow's role in the Ukraine conflict and has been grappling with a mountain of bad debt after financing politically expedient projects such as construction for the Sochi Winter Olympics.
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Plus, forecasts are that gross domestic product is going to be lower than expectations in the third quarter and even lower in the fourth quarter, and there are bad demographics and bad debt, he added.
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There are concerns that a return to state-dominated investment programs targeting infrastructure and property - like that launched in the aftermath of the global financial crisis - will saddle Chinese banks with even more bad debt.
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Macau, May 18 (Reuters) - Casinos in Macau face a growing volume of bad debt provisions, further hitting earnings in the world's largest gambling hub at a time when high-roller VIP punters are backing off.
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The news comes as DBS posted a slight increase in third-quarter net profit, in line with expectations, although bad debt provisions rose sharply due to its exposure to the troubled oil and gas sector.
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Banks in the United Arab Emirates have reported a sharp spike in bad debt charges in the fourth quarter, as they navigate a sluggish economy and a property downturn in Dubai that has hit contractors.
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The ECB wants banks to sell or provision for the bad debt they've inherited from the last recession so they can focus on extending fresh credit and are better prepared to withstand any new downturn.
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The finance minister said the government would provide state-owned banks 21 billion rupees of additional capital that are laden with bad debt which has affected their ability to lend and also spur economic growth.
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Until last year Commercial Bank had been setting aside additional provisions to cover bad debt linked to troubles facing some of its overseas investments, as well as cutbacks in state and consumer spending in Qatar.
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Mr. Mallya is now widely pilloried by the news media and by some politicians in India as one of the worst examples from a corporate borrowing binge that has mired the country in bad debt.
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One of the biggest potential pitfalls for any fund looking to take on secured Italian bad debt is the time it can take to recover the assets in the event the loan cannot be repaid.
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The bank said its net profit for the first half of the year jumped 9.3 percent due to higher net interest income and net income from Islamic financing, which partly offset higher bad debt charges.
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China's provincial governments have rushed to set up asset management companies (AMCs) in recent months after Beijing relaxed rules to allow each province to set up two local AMCs to handle rising bad debt nationwide.
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LISBON (Reuters) - Portugal's three biggest banks plan to manage jointly some of their bad loans to avoid more writedowns, effectively taking on the task of trying to tackle one of Europe's biggest bad-debt burdens.
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Earlier this month, Piyush Goyal, India's interim finance minister, revealed plans to set up an Asset Reconstruction Company or a "bad bank" aimed at absorbing the 9.5 trillion rupee bad debt in state-owned banks.
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MUMBAI (Reuters) - India's Supreme Court on Tuesday quashed a Reserve Bank of India circular on resolving bad debt, providing relief for some major corporate defaulters but throwing the country's still nascent bankruptcy regime into question.
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China Weighs Letting Banks Sell Bad Debt to Investors | The tentative proposal, which officials said on Saturday would be modest in scale, is meant to help alleviate one of the major drags on China's economy.
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Shares in southern European banks, particularly in Italy where the level of bad debt is particularly high, had fallen sharply on worries that the ECB could force them write down the value of bad loans.
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Banks saw soured loans and provisions surge in the quarter after the central bank in February eliminated half a dozen loan restructuring schemes to hasten the clean-up of near-record levels of bad debt.
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India's financial sector has struggled with an ongoing crisis where banks and non-bank lenders have accumulated large amounts of bad debt that are weighing on their profitability and have hamstrung lending as a result.
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BEIJING (Reuters) - China Great Wall Asset Management Co officially launched as a restructured joint-stock firm on Sunday, with an eye towards a market listing and a bigger role in tackling China's mounting bad debt.
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Atlante's modest size meant it couldn't solve the country's 360bn bad debt problem alone, but many hoped it would prop up deals in need and pave the way for others to buy junior NPL risk.
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CEO Rondolat said in an interview with Reuters further margin improvements in 2017 would come primarily from its Professional Lighting division, which was hit by write-downs on bad debt in Saudi Arabia in 2016.
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The more interesting question is not whether these are people made of meat and bad debt like the rest of us (they really are), but why it's so difficult to imagine that they might be.
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Eurobank, Greece's third largest bank, reported net earnings of 56 million euros ($61.96 million) from continued operations, compared with a profit of 6.0 million euros in the second quarter, helped by lower bad debt provisions.
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Eurobank's bad debt provisions fell 21% quarter-on-quarter to 145 million euros, with its so-called non-performing exposures (NPE) dropping to 31.1% of its loan book from 32.8% at the end of June.
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JPMorgan estimated average 13 percent earnings per share cuts in both 2017 and 2018 for European banks, on the back of lower loan growth and expected increases in both bank funding costs and bad debt provisions.
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DUBAI, April 18 (Reuters) - Commercial Bank of Qatar (CBQ), the Gulf Arab state's third-largest lender by assets, reported a 66.7 percent drop in first-quarter net profit on Tuesday, as bad debt charges rose sharply.
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BoC, in an emailed statement, said the fall in coverage ratio was due mainly to an increase in bad debt write-offs, and maintained that its provisions ratio remained higher than other global systemically important banks.
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With nearly half of them under a PCA plan and the rest cautious due to a record $150 billion in bad debt, the government is keen the curbs be relaxed to boost their ability to lend.
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Their problem is that Europe is lacking an effective market for non-performing loans, so selling bad debt would result in big losses and force them to raise capital, a costly exercise given low bank valuations.
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Both BoCom and AgBank, China's No.3 listed commercial bank by assets, saw a small reprieve in non-performing loan (NPL) growth last year, highlighting their efforts to clean up bad debt from their balance sheets.
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The ECB has been contemplating even stricter rules on bad debt but may shelve those plans after a political backlash, focusing instead on behind-the-scenes work to push affected lenders to take more decisive action.
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Despite criticism, the proposed measures avoid introducing new provisioning requirements for existing bad loans, which could have forced fire-sales of bad debt by banks more exposed to them, leaving large holes in their balance sheets.
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SI), has reported its total bad debt charges doubled in the first nine months of the year to S$972 million, largely because of its lending to oil and gas firms such as Swiber Holdings (SWBR.
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According to the investor, other sectors that are attractive include pharmaceuticals, infrastructure and banking, where, he said, the bad debt crisis is almost over and profits are set to grow as loan provision requirements go down.
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DHFL's plight underscores growing financial sector stress as state banks grapple with nearly $150 billion of bad debt and shadow banking firms battle a liquidity crunch after last year's collapse of Infrastructure Leasing & Financial Services Ltd.
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The Reserve Bank of India's Strategic Debt Restructuring (SDR) swap plan - aimed at reducing a $121 billion corporate bad debt mountain - envisages banks passing on control to a new owner within an 18-month grace period.
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DHFL's plight underscores growing financial sector stress as state banks grapple with nearly $603 billion of bad debt and shadow banking firms battle a liquidity crunch after last year's collapse of Infrastructure Leasing & Financial Services Ltd.
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Shares of two mid-sized Chinese lenders that made their debuts on the Stock Exchange of Hong Kong Wednesday traded lower to flat, reflecting investor fears about non-performing loans and bad debt on the mainland.
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Struggling with soaring bad debt owed by austerity-hit Greeks in recent years and in view of the sharp market share losses, PPC is seeking ways to boost its renewable energy activities and expand its services.
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Azerbaijan's finances appeared to have stabilized this year after the government cut budget spending, and oil prices strengthened, but economists had warned of a lingering risk from bad debt on the balance sheets of Azerbaijan's banks.
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Greek banks have been under regulatory pressure to tackle their bad debt problem, which restricts their ability to expand credit and help the economy recover, with so-called non-performing exposures (NPEs) being their biggest challenge.
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Acharya, in his first speech since taking up his post in January, said India had so far failed to tackle the banks' bad debt problem through a piecemeal approach that had given "all discretion" to lenders.
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It was the out-of-control lending during those boom years, however, that helped to create much of the banks' bad debt burden as they funded high-risk infrastructure projects, including a number of power stations.
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Indian banks' sour loans hit a record 9.5 trillion rupees ($145.56 billion) at the end of June, unpublished data shows, suggesting Asia's third-largest economy is no nearer to bringing its bad debt problems under control.
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BEIJING (Reuters) - China Huarong Asset Management Co Ltd, the country's biggest manager of distressed assets, plans to expand its bad debt business and establish up to five local government-backed asset management companies (AMCs) this year.
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Yet analysts and credit rating agencies have long warned that solving the bad debt at India's banking sector needs to also involve wholesale reforms of the lending practices that led to the surge in bad loans.
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BANGKOK, July 20 (Reuters) - Thailand's Siam Commercial Bank Pcl (SCB) said on Wednesday quarterly net profit fell 3 percent from a year earlier as it set aside loan loss provisions to increase bad debt coverage ratio.
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I'm thankful I had the foresight, for whatever reason—I think because I'd made so many records before Bad Debt, Poor Moon, and Haw—I think we decided... I wanted those records to contain emotional fullness.
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The Indian government also announced plans to streamline the country's state-controlled banks, which hold lots of bad debt, cramping their ability to lend, and proposed that ten state banks be merged into four new ones.
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Earlier this year the mid-tier bank, known as Creval, raised eight times its market value in cash from investors to strengthen its balance sheet but it is still in the process of shedding bad debt.
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The circular was struck down by the Supreme Court of India in April after several companies had challenged the guidelines in court arguing the time given by the central bank was insufficient to tackle bad debt.
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MUMBAI (Reuters) - Just when many Indian banks thought the worst of their bad debt woes were behind them, new central bank rules are stoking fears that the worst of the soured-loans buildup is yet to come.
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With nearly half of them under a PCA plan and the rest cautious due to a record $150 billion in bad debt, the government has been keen to relax the curbs to boost their ability to lend.
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They are responding to growing regulatory pressure to tackle the bad-debt problem, which restricts banks' ability to expand credit and undermines Greece's tentative economic recovery and efforts to end its reliance on European Union bailout funds.
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To further help lenders offload their bad debt, the Commission published non-binding guidelines to set up bad banks or asset management companies that would buy the loans, allowing lenders to focus on their core lending activities.
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SINGAPORE, Feb 16 (Reuters) - DBS Group Holdings, Singapore's biggest lender, reported a 9 percent decline in quarterly profit that came in below market expectations, with bad debt charges climbing on woes in the offshore oil services sector.
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Moments before that announcement, Italy's Monte dei Paschi bank, which fared the worst in the stress test, unveiled a privately funded rescue plan consisting of 9.2 billion euro sales of bad debt and 5 billion euro recapitalisation.
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With nearly half of them under a PCA plan and the rest cautious due to a record $150 billion in bad debt, the government has been keen the curbs be relaxed to boost their ability to lend.
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As a result its cumulative operating profits (before the bad-debt charges) were $261bn over the past decade: another staggering sum, higher than those of any bank other than JPMorgan Chase and Wells Fargo, America's two mightiest.
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Jiang has been credited with helping to transform the state-owned Bank of Communications, which had been plagued by bad debt, into a bank with a stronger balance sheet that then listed in Hong Kong and Shanghai.
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BEIJING/SHANGHAI (Reuters) - KKR & Co said it had partnered with one of China's biggest state-owned bad debt managers to take advantage of opportunities in the country's growing market for distressed debt, particularly in the property sector.
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Goldman Sachs Group and Oaktree Capital Group were among 120 institutional investors attending a $7 billion bad debt portfolios offering by China Cinda last May, the largest ever sale promotion of the state-owned distressed debt manager.
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The worst is over for India's public sector banks, which have struggled in recent years with large levels of bad debt that have hamstrung their growth, according Jayant Sinha, the country's minister of state for civil aviation.
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The bank's board, which met on Friday, is mulling the idea of creating a "bad bank" vehicle for its non-performing loans, which eventually could also take in bad debt from other Italian lenders, the Sole said.
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The guarantee was devised earlier this year as a way to help banks strike better pricing when selling NPLs, allowing them to shed some of their 236.8bn in bad debt without taking deep losses they can't absorb.
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The bad debt ties up capital, preventing the banks from making new loans and with fears of further writedowns looming large Italian banks have seen their share prices fall by roughly a quarter so far this year.
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Various plans floated throughout the year to deal with the bad debt - including moving it to a separate fund-of-funds - were shelved, so the problem has lingered as one of the worst hangovers from the crisis.
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Swapping debt into equity in a troubled borrower might get bad loans off lenders' books, but as CCB Chairman Wang Hongzhang warned earlier this month, there was a danger of simply converting "bad debt into bad equity".
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In essence, good debt can help you get ahead — like taking on student loans to land a high-paying job — while bad debt typically costs more than you stand to gain from it — like credit-card debt.
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"Hospitals benefited dramatically from Obamacare, simply because all of a sudden they had more people with insurance and less bad debt expense," said Scott Schermerhorn, chief investment officer with Granite Investment Advisors, which does not own hospitals.
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Ziraat had proposed a plan to enable banks to move bad debt from their books into an off-balance-sheet vehicle, guaranteeing them interest income in the near term and repayment of the loans within 10 years.
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"Primary reason for this loss are the irregularities discovered in our biofuel trade business in Rotterdam, which led to a considerable overstatement of our stocks and forward book and to a substantial bad debt position," Nidera said.
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Sources told Reuters last month the ECB planned to give euro zone banks non-binding guidance by the end of 2016 or early 2017 to cut bad debt, raising pressure on lenders but not forcing their hand.
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The association - which has been at the center of discussions of how to deal with Turkey's billions of dollars in bad debt - added that it would also implement a loan restructuring programme for smaller companies, pending approval.
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Despite the broader declines seen in greater China markets, banking stocks listed on the mainland got a boost after Reuters reported on Tuesday that regulators intended to cut the proportion of funds required to cover bad debt.
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NBG Chief Executive Leonidas Fragiadakis said efforts to reduce the bank's bad debt continued unabated for a sixth straight quarter in July-to-September, with the stock of NPEs dropping by 200 million euros quarter-on-quarter.
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But that instruction was struck down by the Supreme Court of India in April after several companies challenged the guidelines in court, arguing that the time given by the regulator was insufficient to tackle bad debt issues.
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The European Central Bank on Friday rejected criticism of its plans to tackle soured bad debt, arguing that the move was both legal and necessary to resolve a nagging problem that has bogged down banks for a decade.
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Hoping to ease concerns about its original proposal, the ECB said the guidelines were non-binding expectations and would merely serve as the basis for case-by-case dialogue with banks on how they provision against bad debt.
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DUBAI, July 20 (Reuters) - Mashreq, Dubai's third-biggest lender by assets, on Wednesday posted a 16.1 percent fall in second-quarter net profit as impairments for bad debt more than doubled and fee and commission income edged lower.
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The finance minister said the government would provide state-owned banks 353 billion Indian rupees ($10.23 billion) of additional capital that are laden with bad debt which has affected their ability to lend and also spur economic growth.
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In March, Australia's so-called Big Four banks - ANZ, Commonwealth Bank of Australia, National Australia Bank and Westpac - saw notable sell-off in their shares, on growing concerns over bad debt and their exposure to the resources sector.
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They are also facing the prospect of further capital increases, higher bad debt charges and calls from some politicians for a sweeping public inquiry following a series of scandals over improper financial advice, rate rigging and insurance claims.
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The Reserve Bank of India (RBI) has demanded banks recognize bad debt by March, after which the government has promised an injection of 250 billion rupees ($4 billion) into these banks, with more expected from private capital raising.
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The NBFCs, that currently manage an aggregate loan book of nearly $300 billion, have played a key role in lending growth in India as the main banking sector struggled to tackle a bad-debt burden of $150 billion.
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MUMBAI (Reuters) - India's central bank on Wednesday tweaked an obscure old rule relating to the valuation of state government securities, a move that market insiders warn could pile more pain on state-run banks laden with bad debt.
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Soaring bad debt levels, especially on the books of state-run lenders, have choked the Indian banking system and crippled its ability to generate fresh lending and revive economic growth that has slumped to a six-year low.
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Some of those costs are borne by physicians, who must pay for complex billing systems, denial management, preauthorization requirements, collections management and bad debt, as well as devoting patient time to discussing insurance coverage rather than medical issues.
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Last month Piraeus, Greece's largest lender by assets, wrapped up a deal with Intrum, setting up a large servicer of non-performing loans and real estate assets, as part of efforts to reduce its risk from bad debt.
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SHANGHAI, May 20 (Reuters) - Bank of China Ltd and China Merchants Bank Co Ltd are poised to issue China's first bad debt backed securities since 2008, according to statements posted on the website of China's main bond clearinghouse.
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ATHENS, May 24 (Reuters) - Greece's second largest lender by assets National Bank (NBG) was profitable for a third straight quarter in January-to-March, but net earnings fell sharply from the previous quarter as bad debt provisions rose.
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The banking sector has been struggling for years under the weight of a mountain of bad debt, and defenders of the state aid say the government's and the Commission's broader aim of lowering systemic risk validates the decision.
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Similar to Italy's GACS model, the scheme was created to help lenders to clean up balance sheets and offload bad debt by turning the bundles of bad loans into asset-backed securities that can be sold to investors.
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While the economy has recovered from a brief but sharp recession, Ankara has done little to address the bad debt that economists and bankers say leaves the finance sector vulnerable and keeps capital tied up in unproductive projects.
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The finance minister said the government would provide state-owned banks 700 billion Indian rupees ($10.23 billion) of additional capital that are laden with bad debt which has affected their ability to lend and also spur economic growth.
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PSBC is also expected to fare better than others in the Chinese banking sector contending with sharp rises in bad debt as its "mom and pop" customers tend to more diligent in repaying loans than corporations facing diminished demand.
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The Italian bank and bad debt specialist said on Friday it was in exclusive talks to sell some of its operations to rival Credito Fondiario, in a deal that would create a leading player in the soured loans market.
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SHANGHAI/BEIJING (Reuters) - China's biggest listed lenders, facing the country's slowest growth in more than a quarter century and rising borrower defaults, reported flat third-quarter profits as they moved to clean up bad debt on their balance sheets.
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Three big state banks will provide the funding by year end, Albayrak said as he announced the second state-backed package in less than two months meant to revive an economy plagued by bad debt, recession, and high inflation.
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Li Xin, chief supervisor of China Orient Asset Management Co Ltd, will be named president of Huarong, one of China's largest state-owned bad debt managers, the people said, declining to be identified as the information was not public.
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As head of China's previous banking regulator he started what was widely dubbed a "regulatory windstorm", implementing a flurry of new measures to tackle the sector's most complex problems, from shadow banking and regulatory arbitrage to hidden bad debt.
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"We would like to get some clarity on the governor's thoughts on the banking sector, on the deadline of cleaning up bad debt as this is a priority for the economy," said D.K. Joshi, chief economist at CRISIL Ratings.
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BEIJING, March 28 (Reuters) - China's banking regulator has tightened up its scrutiny of the country's distressed asset managers, in a bid to crack down on improper bad debt transactions with commercial banks, an internal document reviewed by Reuters shows.
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In gross terms, the ECB wants the bank to sell nearly 14 billion euros of bad loans by 2018, almost three times more than the 5.5 billion euros of bad debt sales envisaged in the bank's current strategic plan.
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SINGAPORE, May 10 (Reuters) - China Cinda Asset Management Co Ltd, one of the country's four state-backed bad debt managers, plans to issue offshore preference shares worth up to 30 billion yuan ($4.6 billion) to shore up its capital.
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NEW DELHI (Reuters) - The India government could issue directions to state-run banks to resolve corporate default cases and ensure there is no tampering with the pace of cleaning up bad debt, a finance ministry source said on Wednesday.
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Mourinho Felix said the three banks' joint bad debt clean-up approach would avoid the need for a government-backed 'bad bank', a mechanism used by Spain and Ireland during Europe's debt crisis at a heavy cost to taxpayers.
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It needs to free up capital if it wants to keep its pledge to help stabilise Italy's banking system, which is burdened with 360 billion euros of bad debt, and has promised its investors a 6 percent annual return.
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Performance Sports Group said at the time that it had reduced shipments to customers who were not settling payments and anticipated its bad debt reserves would be higher than expected when finalized during the audit of its annual filing.
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SINGAPORE, April 29 (Reuters) - Oversea-Chinese Banking Corp , Singapore's second-biggest lender, posted a worse-than-expected 14 percent drop in quarterly profit due to an increase in bad debt charges and a lower contribution from its insurance unit.
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The RBI said the meeting with representatives from banks, non-banking finance companies and asset reconstruction companies reviewed existing systems for recasting and restructuring stressed assets, including the joint lenders forum and the rules governing sale of bad debt.
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Italy's banking sector has been struggling for years under the weight of a mountain of bad debt, and defenders of the state aid say the government's and the European Commission's broader aim of lowering systemic risk validates the decision.
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The PBOC sought to calm investors by saying Baoshang was an standalone case, but the move added to worries about rising bad debt and systemic financial risks as Washington ramps up trade pressure and the economic downturn wears on.
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Sources have told Reuters the Treasury had proposed to Brussels a complex scheme that would allow Monte dei Paschi to transfer a bundle of soured loans to state-owned bad debt manager AMCO without writing them down further first.
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SINGAPORE, Oct 31 (Reuters) - DBS Group Holdings, Singapore's biggest lender, posted a slight increase in third-quarter net profit, in line with expectations, but bad debt charges rose sharply from its exposure to the troubled oil and gas sector.
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India's government pledged on Wednesday to inject nearly $14 billion combined into all but one state-run lender by March in return for them implementing reforms, in a bid to boost lending and tackle a record bad debt problem.
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FRANKFURT (Reuters) - Italian Andrea Enria was picked on Wednesday to head the European Central Bank's supervisory arm, overseeing a bloated, 21 trillion euro banking sector still troubled by a legacy of bad debt from the euro zone's financial crisis.
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MUMBAI (Reuters) - India's central bank will add more members to a panel to deal with the large volume of cases involving stressed assets which are referred to it, highlighting its resolve to fight bad debt in Asia's third-largest economy.
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The two countries have seen a surge in bad debt and non-performing loans, but those assets are still for the most part with banks, which may be prodded to clean their balance sheets and create buying opportunities for Oaktree.
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States will have to pick up some of the increased Medicaid costs, while much of the cost of providing care for the low-income Americans who lose coverage will be borne by health care providers as bad debt and uncompensated care.
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Government officials have been pressuring the Reserve Bank of India to allow some bad-debt-laden public sector banks to lend more easily, and pushed for it to hand over some of its surplus reserves to help fund the fiscal deficit.
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Although the Modi Government is working on reforms to the banking system to address the pile of bad debt held by banks, which has been blamed for hampering India's economic growth, Mistry said it was unrealistic to expect a quick fix.
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Over the past few years, large Australian banks have been hit by bad debt charges from loans to companies that suffered from the end of a mining boom, but a recent rebound in commodities prices has helped to improve credit quality.
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The lender, 11% owned by the country's bank rescue fund HFSF, said provisions for bad debt fell to 178.3 million euros from 336 million euros in the same period a year earlier and 669 million euros in the fourth quarter.
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Lenders have agreed with regulators on ambitious bad debt reduction targets, aiming to cut their NPEs to 66.7 billion euros by 2019 to bring their ratio to 34 percent of total loans, down from 51 percent at the end of 2016.
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Starting January 1, it will give lenders two years to set aside funds to cover 100 percent of the value of their newly classified non-performing unsecured debt and seven years to cover all secured bad debt, the draft showed.
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MUMBAI (Reuters) - In January, Innoventive Industries, a speciality steelmaker based in western India, was forced into the bankruptcy court by its lenders, testing for the first time new insolvency rules that aim to resolve India's $1803 billion bad debt overhang.
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AgBank's first-half bad debt write-offs of 38.3 billion yuan were only around 3 billion yuan less than in all of last year, and the bank's president Zhao Huan said it plans to increase disposals in the second-half.
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MUMBAI, July 26 (Reuters) - The Reserve Bank of India's outgoing governor, Raghuram Rajan, on Tuesday staunchly defended his record in curbing inflation and cleaning up bad debt at banks, and he called on the government to protect the central bank's independence.
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Government officials had been pressuring the RBI to allow some public sector banks laden with bad debt to lend more easily, and pushed for the central bank to hand over some of its surplus reserves to help fund the fiscal deficit.
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That corresponds to about one in every 10 Italian loans and almost a third of all soured credit at the 122 large euro zone banks supervised by the ECB, by far the biggest pile of bad debt in the currency union.
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NEW DELHI (Reuters) - India's central bank on Thursday removed Bank of India and Bank of Maharashtra from its prompt corrective action plan (PCA) for state-owned banks with high levels of bad debt and inadequate capital, confirming a Reuters newsbreak.
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A rise in bad-debt charges and a splurge on spending to improve its monitoring of money-laundering helped reduce fourth-quarter net profit at abn amro by 234% compared with the same three months a year earlier, to €316m ($361m).
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That figure, which comes out to a combined 360 billion euros ($401 billion) in bad debt, is more than three times the bank loans that were bad in the U.S. on a percentage basis at the height of the financial crisis.
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The Trump administration has said it wants to privatize the two mortgage companies, which are government-backed entities that were taken into full conservatorship as the U.S. housing market foundered on bad debt during the 313 to 2009 financial crisis.
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BRUSSELS (Reuters) - European Union banks will have to set aside more capital against new loans that could turn sour as of Wednesday, when the European Commission will publish a proposal on larger backstops for bad debt, a draft document showed.
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"It's reached the point where the bad debt problem is just so large the government will have to step in to resolve it at some point, and that obviously means at some point a sizeable increase in government debt," he said.
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BRUSSELS, March 15 (Reuters) - The European Commission said on Thursday that European Central Bank guidelines on banks' bad debt were "compatible" with rules proposed on Wednesday by the EU executive to tackle lenders' future build-ups of non-performing loans.
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ISTANBUL (Reuters) - Efforts to clean up Turkey's bad debt have stalled after bankers rejected or put on hold initial plans, according to people familiar with the matter, frustrating the country's attempts to leave behind the worst of last year's currency crisis.
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The bank's loan loss provision jumped 66 percent from a year earlier to 8.5 billion baht, while its bad debt coverage ratio rose to 130 percent at the end of June from 122.8 percent at the end of March, it said.
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While non-performing loan (NPL) ratios edged down by 0.01 percentage points at each bank, both sharply increased their provisions for future bad debt to cushion themselves against a slowdown in the world's second-largest economy and festering China-U.
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During his first month as CBRC chairman, he started what was widely dubbed a "regulatory windstorm", implementing a flurry of new measures to tackle the banking industry's most complex problems from shadow banking and regulatory arbitrage to hidden bad debt.
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Most state banks have posted big losses in the quarter to March as bad loans surged after the central bank eliminated half a dozen loan restructuring schemes to hasten the clean-up of near-record levels of bad debt in February.
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Creval said the deal lowered its non-performing loan (NPL) ratio — a measure of bad debt as a share of total lending — to an estimated 21 percent as of the end of June from 27 percent at the end of March.
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Banks, brokerages and other financial services firms typically account for the bulk of new listings in the city, but have only comprised 23 percent of IPOs so far in 2017, weighed down by concerns over rising bad debt in China.
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BANGKOK, Oct 18 (Reuters) - Siam Commercial Bank Pcl's (SCB) third-quarter net profit rose 28 percent from a year earlier due to higher net interest income and lower provision expenses, it said on Tuesday, despite a continued rise in bad debt.
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Investors rattled It was the second time a central bank chief had stepped down in less than three years, and investors are concerned the RBI is being pressured to relax its fight against inflation and India's mountain of bad debt.
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SYDNEY (Reuters) - National Australia Bank Ltd posted a 26 percent rise in first-half cash profit on Thursday, as strong revenue and above average lending growth in Australia and New Zealand more than offset lower margins and higher bad debt charges.
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If the same criteria are applied for both new and existing bad loans, banks would be given at most until 2026 to write off their stock of bad debt, which has weighed on their balance sheets since the bloc's debt crisis.
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MUMBAI, Feb 12 (Reuters) - The Reserve Bank of India said late on Monday it was withdrawing all its existing mechanisms for tackling bad debt at Indian banks and replacing them with a harmonised and simplified generic framework for resolving stressed assets.
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WASHINGTON (Reuters) - A Congressional plan to help Puerto Rico shed billions of dollars in bad debt can win enough support to make its way to a vote in the House of Representatives, U.S. lawmakers who support the measure said on Tuesday.
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But a new bankruptcy law and a move this month to give India's central bank expansive powers to tackle bad debt have excited investors both here and abroad who think investing in India's distressed market could produce double-digit returns.
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After Italians voted this month against changes to the Constitution, prompting Prime Minister Matteo Renzi's resignation, there are fears that political instability could deter investors who are needed to provide capital and to help Italian banks dispose of bad debt.
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MUMBAI (Reuters) - India's central bank said on Tuesday it has identified 12 of the largest loan defaulters and will order lenders to start bankruptcy proceedings against them to start unclogging the $73 billion in bad debt plaguing Asia's third-largest economy.
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Lenders have agreed with regulators on ambitious bad debt reduction targets, aiming to cut their NPEs to 66.7 billion euros by 2019 to bring their ratio to 34 percent of total loans, down from 3723 percent at the end of 2016.
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FRANKFURT, June 19 (Reuters) - Euro zone banks are making progress in reducing their pile of bad debt, but further swift and decisive action is still needed, European Central Bank supervisor Daniele Nouy told the European Parliament's economic affairs committee on Monday.
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FRANKFURT (Reuters) - Euro zone banks may get a reprieve until 2021 to fully implement European Central Bank guidelines on treating new soured loans, an ECB document showed on Thursday, a retreat from an earlier proposal for a more aggressive treatment of bad debt.
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MILAN, July 14 (Reuters) - Italian lender Banca Carige is considering a sale of the platform it uses to manage bad loans, two sources familiar with the matter said, at the same time as it prepares to offload 13 billion euros of bad debt.
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The European Commission is expected to rule on the scheme that would allow the Italian state-owned bank to transfer a bundle of soured loans to state-owned bad debt manager AMCO by the end of February, Il Sole 2300 Ore reported.
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In Singapore, United Overseas Bank (UOB) shares traded 2.16 percent lower at S$18.53 ($13.28) after it reported its third-quarter profit fell 20.16 percent year-on-year to $218 million, hurt by rising bad debt allowances from the oil and gas sector.
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Anticipating some of these losses, top banks in Italy have already set aside reserves equal to 45.4 percent of all their bad debt, a higher 'coverage ratio' than in all but a few euro zone nations but still below prevailing market prices.
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Banks in Italy sat on 187 billion euros worth of bad debt at the end of last year, over a quarter of the euro zone's total, but this is down from 196 billion three months earlier and 248 billion a year ago.
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Shawn Tydlaska, CFP, founder and CEO of Ballast Point Financial Planning, debunked some common misconceptions: "In terms of educating my clients about good versus bad debt, one thing I tell them is that good debt is deductible on your tax return," Tydlaska said.
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Given India's companies have been more conservative with their investment plans given the slowdown in the economy as well as their bad debt problems, a drop in consumption would push growth lower unless compensated by gains in fiscal spending and trade gains.
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In Europe, concerns over high levels of bad debt in Italy put UniCredit, Banca Monte dei Paschi di Siena and Banco Popolare under pressure, a situation that was exacerbated when the European Central Bank requested information on nonperforming loan portfolios from these banks.
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The results mark a fifth consecutive quarter of profit growth for the bank, which until last year was hobbled by extra provisions to cover bad debt linked to troubles facing some of its overseas investments and weaker state and consumer spending in Qatar.
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MUMBAI, June 22 (Reuters) - India's central bank on Thursday reconstituted a panel to oversee restructuring of troubled loans, as it strives to cut more than $150 billion of bad debt banks in Asia's third-largest economy have accumulated over the past years.
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Traders cited news over the weekend that the European Central Bank was looking into a number of euro zone banks about non-performing loans, as the central bank looks to increase its efforts in tackling the region's mountain of bad debt, Reuters reported.
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BANGKOK, July 15 (Reuters) - Thailand's Thanachart Capital Pcl, a partner of Canada's Bank of Nova Scotia , said on Friday its quarterly net profit rose 5.2 percent to the highest in 10 quarters, helped by lower provisions and a drop in bad debt.
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Despite the disappointment, some hoped the new measures would help trigger action from banks that have long dragged their feet, even if questions remained over the RBI's new powers and whether it was better equipped to tackle bad debt than commercial banks.
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"The recent rally in banks was a bit overdone as there is still not much clarity with regard to how the government's ordinance for tackling bad debt will pan out," said Saurabh Jain, assistant vice-president of research at SMC Global Securities.
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Among the potential solutions suggested by Acharya were the creation of private asset management companies, or private equity type companies, that would raise private funds and help buy up and restructure the bad debt, forcing haircuts by banks and creditors if necessary.
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Bankers and credit rating agencies say they doubt the latest move by New Delhi to provide a further $10 billion in government money to the institutions that dominate India's banking landscape will be enough for them to overcome massive bad debt problems.
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State-run banks account for the lion's share of more than $150 billion in bad debt which is weighing on the sector, and need billions of dollars in new capital in the next two years to meet global Basel III capital regulations.
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The euro zone bank sector fell 3.1 percent, with traders citing news over the weekend that the ECB is quizzing a number of euro zone banks about non-performing loans as it ramps up efforts to tackle the region's mountain of bad debt.
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While banks remain the main source of funding for India's companies, the stubborn bad debt problem has eaten into bank profits and choked off new lending, especially to smaller firms, at a time when an economy that depends on them is stalling.
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The ECB last week issued new proposals that will force euro zone banks from next year to set aside more cash to cover newly classified bad loans and may also present additional measures to tackle the sector's huge stock of bad debt.
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Evidence of an improved operating trend would include sustained positive growth in organic patient volumes, sustained improvement in the payor mix with fewer uninsured patients and correspondingly lower bad debt expense, and limited concern that profitability will suffer from drops in reimbursement rates.
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Since China's policymakers re-launched the debt-for-equity scheme in October last year to ease the borrowing overhang of struggling firms, the country's state-run banks and bad debt managers have rushed to sign deals with big state-owned enterprises (SOEs).
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Banks have been hit in recent weeks by concern the slumping construction sector could saddle them with bad debt, and by authorities' decision to have them reschedule consumer loans to customers whose incomes have been hit by cuts to public sector allowances.
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ATHENS (Reuters) - Greece's big banks must not relax efforts to reduce their bad debt after the positive outcome of a health check by the European Central Bank, a source familiar with the situation said on Tuesday, as the sector still faces challenges.
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With so much bad debt run up by past projects, it will be tough to persuade the private sector to contribute more than a fifth of the $1.4 trillion the government wants invested over five years on power, roads, rail and more.
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ISTANBUL, Sept 19 (Reuters) - Turkey's top banks have discussed creating an asset management company (AMC) in which to transfer their higher-quality non-performing loans (NPLs), as a possible solution to the country's bad debt problem, said two people familiar with the talks.
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ISTANBUL, Nov 27 (Reuters) - Turkey's BDDK banking watchdog changed loan classification regulations so that banks are able to remove from their books "Group 5" classified non-performing loans (NPL), marking another step to clean up bad debt from last year's currency crisis.
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A possible solution to NPLs would be the creation of a single platform that acts as a data warehouse for bad debt, a transaction system and a trade data repository, the ECB said in an article that forms part of its biannual Financial Stability Review.
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BENGALURU, India, June 22 (Reuters) - India's central bank governor Raghuram Rajan urged the country to clean up the bad debt held by its banks, calling it key to achieve stronger economic growth, in his second public appearance since saying he will step down in September.
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FRANKFURT (Reuters) - The European Central Bank will ask euro zone banks from next year to set aside more cash to cover newly classified bad loans and may also present additional measures to tackle the sector's huge stock of bad debt, it said on Wednesday.
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The European Central Bank has asked Italy's third-largest lender to slash its bad debt by 40 percent in three years, heightening concerns that the bank may have to make a cash call at a time when investor appetite for bank stocks is low.
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Indeed, banks' loan growth at 10.7 percent in the last fiscal year ended March 31, was the slowest in nearly two decades, partly on lower lending to debt-heavy sectors such as iron and steel that account for the lion's share of bad debt.
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Since 2008 Santander has recorded a cumulative $1103bn of bad-debt charges, more than any bank except Citi and Bank of America (which were bailed out) and double the sum at ICBC, the biggest bank in China, the economy with the most dud loans.
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MILAN, Jan 21 (Reuters) - The European Commission is asking for more details on a new Italian plan for a vehicle to help banks sell bad debt and a technical meeting will take place on Friday, EU Competition Commissioner Margrethe Vestager was quoted as saying.
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Sanyal's comments came a day after India's central bank revealed that it had identified 12 of the largest loan defaulters and would order lenders to start bankruptcy proceedings against them to start unclogging the $150 billion in bad debt plaguing Asia's third-largest economy.
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For India, a deal collapse or a delay because of talks with another party would set back Modi's drive to clean up India's $140 billion mountain of bad debt given Essar's multi-billion-dollar debts to local and foreign banks after years of rapid expansion.
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Yet hopes that the fund would jumpstart public NPL securitisation faded when Atlante spent 2.5bn taking over two regional lenders after their IPOs flopped, blowing the bulk of its firepower before it could even put a dent into the country's 360bn bad-debt burden.
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Non-performing loans as a proportion of total loans rose to 9.3 percent in August from 8.4 percent in June and from 5.7 percent in December, due partly to stricter reporting of bad debt and partly to the slower growth in private-sector lending.
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"A lot hinges on how much of the bad debt are they taking on and I'm assuming that that is actually going to be parceled off into a bad bank and therefore Santander will end up with the viable retail and banking operations," Parker observed.
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MUMBAI, Feb 21 (Reuters) - Reserve Bank of India Deputy Governor Viral Acharya said India needs to urgently address the large amounts of bad debt held by its lenders, outlining potential solutions including the creation of public or private agencies to buy the soured loans.
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FRANKFURT, June 21 (Reuters) - Europe needs a comprehensive policy response to cut the high level of bad debt on bank balance sheets and more action is needed to address shortcomings in insolvency, collateral and taxation frameworks, ECB Vice President Vitor Constancio said on Tuesday.
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ISTANBUL, Nov 8 (Reuters) - The European Bank for Reconstruction and Development made 30 recommendations on Friday for Turkey to restructure its laws and markets so that foreign companies could easily buy some of the tens of billions of dollars in bad debt held by lenders.
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MUMBAI (Reuters) - A proposal by India's central bank to set up new private or state companies that would buy up bad debt from lenders was met with widespread scepticism by bankers on Wednesday, who warned the plan would add more complexity and delay any restructuring.
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The rupee coming under pressure signals potential troubles that await Asia's third-largest economy, which saw growth slowed in the past year as it grappled with a surprise demonetization, the introduction of a Goods and Services Tax and mounting bad debt in the banking sector.
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Euro zone banks are sitting on nearly 1 trillion euros' worth of bad debt, clogging up their balance sheets and holding back lending - a headache for the ECB as weak credit growth offsets the stimulus it is trying to provide through low interest rates.
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The economy has begun to recover from recession but another spillover is billions of dollars worth of bad debt that sits on the balance sheets of Turkish banks, which lent to companies that could not afford to service them as a result of the crisis.
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The economy has begun to recover from recession but another spillover is billions of dollars worth of bad debt that sits on the balance sheets of Turkish banks, which lent to companies that could not afford to service them as a result of the crisis.
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The result for Australia's No. 1 lender caps a run of bank results which have included some of the lowest bad debt charges on record, but left concerns that lenders may not be fully prepared for a downturn in the property and retail sectors.
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Great Wall chairman Zhang Xiaosong said at a ceremony in Beijing on Sunday the restructuring marks "a new era" for the company, which will continue to focus on bad debt solutions and asset management to help curb financial risks and support China's economic development.
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ISTANBUL, Feb 21 (Reuters) - Turkey's banks have hired Ernst & Young to analyse launching an asset management company (AMC) to house billions of dollars of bad debt, an idea that has gained traction to help solve a problem that has loomed since a 2018 currency crisis.
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"This has been well flagged - a greater than expected slowdown and worries about very high levels of bad debt in the economy, especially with respect to loans to struggling industrial companies and property lending," said London-based Sanjiv Shah, CIO at Sun Global Investments.
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In the first nine months of last year, IU Health officials said, the amount of bad debt owed by patients and referred to collection agencies totaled $233 million, a 23 percent reduction from the comparable period in 2015, thanks largely to Mr. Obama's health law.
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Subramanian said the government is also thinking about the banking sector, which is slowly recovering from a major bad debt crisis; New Delhi wants to ensure there is no additional impact of the coronavirus on India's lenders due to a potential slowdown in demand.
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The squeeze has also played a big role in denting economic growth, as NBFCs had in recent years evolved into major lenders to the real estate, small business and infrastructure sectors, with lending growth from state-run banks slowing due to bad debt woes.
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ATHENS (Reuters) - Three of Greece's largest lenders plan to sell up to 21.5 billion euros ($22018 billion) in bad loans by early next year, sources said, as the country's central bank chief called on the creaking banking sector to act faster to tackle its bad-debt problem.
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Here is the size of the Chinese bad debt problem: The rate of non-performing loans is as high as 20%, or $1 trillion, Shvets says: The build-up of debt is mostly occurring in corporate sector and bulk of that within China's bloated SOE segment.
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Indicators from the consumer, investment and factory sectors have suggested the prolonged slowdown in the world's second-largest economy may be bottoming out, and many analysts no longer expect much in the way of aggressive policy easing going forward, given concerns about rising levels of bad debt.
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Banks have been hit in recent weeks by concern that the slumping construction sector could saddle them with bad debt, and by the central bank's decision to have them reschedule consumer loans to customers whose incomes have been hit by the government's cuts to public sector allowances.
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"We're trying to assess company performance to see whether there are going to be any liquidity issues, any collection issues, bad debt issues, things that would be indicative of the way payments and coverage may be affected," said Farboud Tavangar, a founder of LCM Asset Management.
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Tackling bad debt has been a key priority for the ECB as the massive pile of soured loans, many of them a decade old, keeps banks from lending to the real economy, countering the very stimulus the bank is trying to provide through ultra easy monetary policy.
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The ECB banking supervisor proposed last week that euro zone banks should set aside more cash from next year to cover newly classified bad loans and may also present additional measures to tackle the sector's huge stock of bad debt which amounts to nearly 1 trillion euros.
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The results mark a fourth consecutive quarter of profit jumps for the bank, which until last year was setting aside additional provisions to cover bad debt linked to troubles facing some of its overseas investments, as well as cutbacks in state and consumer spending in Qatar.
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However, the source told Reuters that the central bank aims to raise up to 150 million euros this month for the planned liquidity operation, ensuring the banks have stable funding while they and authorities work on finding a longer-term solution to the bad-debt problem.
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The Reserve Bank of India's financial stability report said in December that large borrowers accounted for more than 80 percent of bad debt in portfolios of scheduled commercial banks in September — those include public sector and private sector Indian banks, regional rural banks and private foreign banks.
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"Transitioning federal Medicaid payments to a per-capita, or block grant system, and freezing Medicaid expansion would reduce the number of people with insurance and increase hospitals' exposure to bad debt and uncompensated care cost," said Daniel Steingart, a senior analyst and vice president at Moody's.
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MUMBAI, March 17 (Reuters) - The coronavirus pandemic has sparked concerns about a fresh surge in bad loans at India's lenders, and the industry body representing the banks plans to appeal to regulators to provide some reprieve in bad-debt classification, two sources told Reuters on Tuesday.
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MUMBAI, March 20 (Reuters) - Indian banks have asked the banking regulator to allow more time before labelling a loan as bad debt, and they sought longer deadlines to meet certain capital standards as the coronavirus pandemic derails businesses, sparking concern over the financial health of banks.
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Vice President Zhou Liyao said at a news conference late on Thursday Great Wall had handled more than 1 trillion yuan in bad debt from financial institutions and alleviated debt burden for more than 300 large and medium-sized state-owned companies through debt-for-equity swaps.
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The ruling is a boost to the government, which in May tweaked Indian banking laws to empower the Reserve Bank of India (RBI) to tackle the country's bad debt issue, allowing the RBI for the first time to direct lenders to force defaulters into insolvency courts.
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A mountain of bad debt in India's banking system has led to a prolonged credit crunch that is inflicting most pain on small- and medium-sized enterprises (SMEs) such as Pandey's that depend upon banks for their day-to-day working capital and longer-term borrowing needs.
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HANOI, March 16 (Reuters) - Bad debt in Vietnamese banks fell to 2.55 percent of total loans at the end of 2015 from 3.25 percent a year earlier, according to central bank data, the lowest since 2010, when a debt crisis started to emerge in the beleaguered banking sector.
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Among the specialised retail banks Tinkoff Bank, Home Credit & Finance Bank and Rencredit grew by 1%-3%, Russian Standard was stable, while Joint Stock Company OTP Bank deleveraged by 6% (probably due to loan write-offs and/or bad debt sale as the decrease was mainly in overdue exposures).
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Rather, focus on the difference between good debt and bad debt and knock out the bad stuff first, which includes high-interest credit cards as well as any debt with small balances "to get some wins under your belt and to free up your cash flow," Snider said.
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And a multi-year loan of just under 2 billion yuan ($296 million) to a medium-sized developer made by Huarong via a Shanghai branch of a trust firm this year is another deal the bad debt manager is trying to exit, said a second person with direct knowledge.
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China's most coal-dependent province has moved to ease rising pressure on seven of its largest coal miners by extending the maturity on up to Rmb400 billion ($60 billion) in loans, in a sign of the severity of the bad-debt crisis gripping the country's depressed coal sector.
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The continued climb in foreign inflows into India also left investors wondering whether the central bank has other tricks up its sleeve as it maintains economic progress in a country that is also battling softer-than-expected inflation and rising levels of bad debt in the banking system.
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Piraeus, with a current market value of 2.02 billion euros, said bad debt provisions fell to 258 million euros, from 310 million in the fourth quarter while non-performing loans made up 37.8 percent of its book at the end of March, from 37.5 percent in the previous quarter.
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Elekta reported a 30 percent year-on-year jump in operating profit before interest, tax, amortization, one-offs and bad debt losses for the three months through October, its fiscal second quarter, to 509 million crowns ($61 million), against a mean forecast of 432 million in a Reuters poll of analysts.
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"Our research suggests that 2015 was the first year since the early 2000s that sizable banks were bailed out," Jason Bedford, analyst at UBS explained in a research note Thursday, adding that the process is still at a very early stage and that bad debt accumulation is significant and still rising.
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Rajan was feted by investors for his efforts to deal with a mountain of bad debt clogging India's financial system, but his critics say an excessive focus on asset quality has scared banks out of lending and is partly to blame for credit growth slumping to a near two-decade low.
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One key reason for the lack of progress in restructuring the construction sectors bad debt is sharp disagreement over the value of partly built or vacant condominiums, offices and shopping malls across the country, leaving banks and companies unwilling to buy or sell assets, several of the people Reuters interviewed said.
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The Atlante fund set up to help free Italy's banks of bad debt will make an offer to buy the impaired loans of three small banks that were rescued from bankruptcy a year ago, the head of Atlante said on Tuesday, rejecting concerns that it had run out of money.
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"Performance of financial stocks is perhaps suggesting that the easing cycle in Australia might be coming to an end a little quicker than people had anticipated, also there is a bit of growing stress within the bad debt side of the linebooks for all of these major banks," McGlew added.
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MUMBAI (Reuters) - India's stock of soured bank loans shrank slightly in the quarter to September last year, the first pullback since a drive to clean up record levels of bad debt began in 2015 and signaling that tighter rules and a new bankruptcy code may be starting to show results.
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One key reason for the lack of progress in restructuring the construction sector's bad debt is sharp disagreement over the value of partly built or vacant condominiums, offices and shopping malls across the country, leaving banks and companies unwilling to buy or sell assets, several of the people Reuters interviewed said.
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The news will likely add to a controversy between investors who lost money in the rescue and authorities and Santander who say the sale of Popular, saddled with bad debt and facing a run on its deposits, for one nominal euro in June, was the best possible solution for depositors.
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The case, along with a flurry of smaller loan frauds since reported by other banks, has sparked new concerns that credit growth is unlikely to pick up quickly in an economy where state-run lenders that account for two-thirds of banking assets are already saddled with a mountain of bad debt.
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To prevent a pile-up of new bad debt on top of an existing stock of sour loans worth nearly 850 billion euros ($1 trillion), the ECB wants to introduce new guidelines including a two-year deadline for lenders to raise provisions from January for any newly classified non-performing unsecured debt.
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"The inherent conflict of interest between banks and brokers means that in a downturn there is an increased possibility of higher bad debt than if the banks had sold all the loans through their own branches," said Omkar Joshi, portfolio manager at Regal Funds Management which has A$1.7 billion in assets.
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"(Australian) banks remain the best of the bunch with a gross yield around 23.7 percent in 2017 there is enough premium in the yield to counter the bad-debt cycle while the regulatory and interest rate cycle outlook is improving," Mathan Somasundaram, a quantitative strategist with Baillieu Holst, said in a note.
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DHFL's plight underscores the growing stress in India's financial sector as state-owned banks are grappling with nearly $150 billion of bad debt, even as the country's shadow banking industry has been brought to its knees by a liquidity crunch following the collapse of infrastructure lender Infrastructure Leasing & Financial Services Ltd last year.
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In that scenario, RBS would need to expand revenue by 93 percent over the next three years to around 14.4 billion pounds to meet its return target, according to a Breakingviews calculation which assumes bad debt charges rise to 1 billion pounds a year in 2020 and earnings are taxed at 30 percent.
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The SBV has forced sector-wide restructuring and buy-outs, shrinking 15 banks into seven and setting up an asset management firm on a meagre budget that helped trim bad debt from 17.2 percent of credit in September 2012 to 2.7 percent last month, although many NPLs have yet to be fully settled.
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HONG KONG, May 25 (Reuters) - China Great Wall Asset Management Co, one of the country's Big Four state-owned bad debt managers, is looking to raise about $1 billion ahead of a planned initial public offering (IPO) in Hong Kong in 2018, IFR reported on Thursday, citing people familiar with the plans.
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Investors seem ready to take an upbeat view, despite continued tensions with Washington over a Russian defence system which Turkey has bought and which could prompt U.S. sanctions, a pile of bad debt left behind by a sharp economic slowdown that has yet to be tackled and an urgent need for structural reforms.
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Long-term healthcare providers who accused the Centers for Medicare and Medicaid Services of acting arbitrarily by changing its bad-debt reimbursement policy without notice lost their lawsuit on Friday, when a federal judge in Washington, D.C. ruled that they had not offered any evidence to show that that policy had actually changed.
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While pawning gold has long been an option for quick funds in a country that is the world's second-biggest consumer of the yellow metal, several lenders told Reuters of unprecedented demand as people struggle to secure loans from banks grappling with bad debt and a shadow lending industry stung by a liquidity crunch.
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But since the problem of non-performing loans affects mostly southern banks, especially in Italy and Greece, that same stance has alienated southern countries who fear that any further aggressive moves to reduce bad debt would force banks to raise more capital, depressing their valuation even further and possibly leaving them open to takeovers.
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While non-performing loan (NPL) ratios edged down by 0.01 percentage points at all the so-called Big Four state banks, which also include Bank of China Ltd (BoC) , the lenders sharply increased provisions for future bad debt to cushion themselves against a slowdown in the world's second-largest economy and festering China-U.
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While non-performing loan (NPL) ratios edged down by 0.01 percentage points at all the so-called Big Four state banks, which also include Bank of China Ltd (BoC), the lenders sharply increased provisions for future bad debt to cushion themselves against a slowdown in the world's second-largest economy and festering China-U.
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Investors, both foreign and Chinese, have grown increasingly nervous as growth in the world's second-largest economy has cooled to a 25-year low, raising questions about Beijing's ability to deliver on promised reforms such as shedding bad debt and reducing industrial overcapacity without setting off a financial crisis or a spike in unemployment.
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Daiwa estimates the junket industry's total debt could be between HK$30 billion-HK$60 billion ($3.9 billion to $7.7 billion) Sands China, the Macau unit of U.S. billionaire and prominent republican donor Sheldon Adelson, missed estimates for first-quarter earnings, with Morgan Stanley analysts attributing the negative surprise to a bad debt of $22 million.
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China's big five banks are losing money from writing off bad debt at a rate faster than they have been able to earn profits or raise capital this year, diminishing hopes that the industry could start to put the worst of China debt problem behind it next year while the non-performing loan (NPL) ratio is still climbing.
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While China may be trying to tackle the problem by reforming the banking system and retrenching the economy simultaneously, "it's going to be very difficult to fix the banks and fix the bad debt problem unless they begin at the root, which is the state-owned enterprises (SOEs)," he said, noting China has made little progress on reforming SOEs.
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The third-largest euro zone economy had been weakened by a deep recession which left behind 356 billion euros ($377 billion) in gross problem loans and Italian banks need at least 20 billion euros in capital in the coming months to cover losses from fresh loan write-downs and planned bad debt disposals, according to a Reuters report.
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The other two contentious issues relating to easing curbs on some banks who are under the so-called prompt corrective action (PCA) plan due to a rise in bad debt and low capital, and the one related to sharing more funds from RBI reserves, were kicked down the road to be discussed later by separate committees.
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The IRS can audit your returns for up to three years after you file if it determines you may owe additional tax, six years if it believes you underreported income by 25 percent or more and up to seven years if you file an incorrect claim for a capital loss from a worthless security or have bad debt.
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VIABILITY RATINGS OF VIETINBANK, VIETCOMBANK, ACB AND MILITARY BANK We may consider upgrading the Viability Ratings of the Vietnamese banks if structural issues, such as bad-debt resolution and weak capital buffers, are more adequately addressed, leading to greater transparency and, together with sustained strong economic performance, to continued improvements in the banks' overall financial profiles.
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And I had an epiphany I think, with Bad Debt and Poor Moon, that we're all in this room together making these records because we have these specific relationships with one another that are built on love and humor and all kinds of deep emotions, and that's what we're trying to capture in this room right now, those qualities.
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An earlier plan to set up an EU "bad bank" that could have absorbed big chunks of bad debt at higher prices was dropped, in part because EU states with healthier banks, like Germany, are not keen to use taxpayers' money to help lenders in the mostly southern European countries where the bad loan problem is worst.
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Analysts said that the injections were just one step in the long process to clean up India's bad debt, and that the lenders' final capital position will also depend on how they undertake the central bank's directive to take nearly 40 large corporate loan defaulters to bankruptcy proceedings, which will likely involve haircuts on their loans.
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As TD and Canadian Imperial Bank of Commerce (CIBC) prepare to wrap up the 2019 fiscal reporting season on Thursday, the picture emerging is of a sector battling higher bad debt provisions, margin pressure in the United States and a sluggish environment for deals, making it the worst year for earnings growth since the financial crisis.
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See the bottom of the report for more details) Adds details, closing prices) * Euro STOXX 0.10 index up 0.1 pct * German shares outperform after factory data * Italian banks lower after govt bad debt measures * Allianz rises after results By Danilo Masoni and Atul Prakash MILAN/LONDON, May 2 (Reuters) - European shares edged up on Monday after sharp declines in the previous session, with German shares outperforming the broader market after a positive manufacturing survey.
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Thailand's LH Bank, a unit of LH Financial Group Pcl , says: * Expects loan growth of 6-10 percent this year, and more than 10 percent next year * To curb non-performing loans at less than 2 percent of lending this year, from slightly more than that level currently * Sees banking sector's bad debt rising in second half from smaller- and medium-sized businesses Further company coverage: (Reporting by Satawasin Staporncharnchai; Writing by Orathai Sriring)
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"If you look at the fundamentals of what happened in Europe after the crisis and for the last decade versus the U.S., the U.S. was very quick to write down bad debt and recapitalize the banks whereas Europe tended to 'ringfence' a lot of this bad sovereign debt but they left it on the banks as part of the bank capital, and that means that the banks themselves are not nearly as strong," said Sanchez.
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Non-Recurring items was SEK -183 million (-1) and bad debt losses was SEK -43 million (-138) * Q29 net order bookings increased 220 percent to SEK 22017,218 million vs year-ago 2700,22017 million and increased 20153 percent based on constant exchange rate * Reuters poll: Elekta Q22015 order bookings were seen at SEK 216,2200 million, adjusted EBITA at SEK 905 million, dividend per share SEK 0.72 * Says to further reduce inventories, will undertake temporary reduced production and shipment volume, with a one-off negative revenue impact estimated at about SEK 500 million in first half of fiscal year 2016/17 * Says expects a weak result during first half of fiscal year 2016/163 * Says additional expected costs related to transformation are estimated to be approximately SEK 300 million and will be charged as a non-recurring item during fiscal 2016/17 * Says going forward Elekta will not provide a net sales outlook * "The markets are more volatile than previously, especially emerging markets are harder to predict these days", Chief Executive Tomas Puusepp tells Reuters * CEO says market in North America and China are stable and good.
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