In July 2017, the Council of the EU adopted the European Commission’s (Commission) Action Plan to tackle non-performing loans (NPLs) in Europe. The Action Plan called upon various institutions to take appropriate measures to address the challenges of high NPL ratios in Europe.
The Commission has now published its first ever progress report on the implementation of the Action Plan comprising a communication and a Staff Working Document. The progress report highlights recent NPL developments in both the EU and individual Member States and explains that the positive trend of falling NPL ratios has solidified and continued into the second half of 2017.
The Commission also states that in the spring it will propose a comprehensive package of measures to reduce the level of existing NPLs and to prevent the build-up of NPLs in the future. The package will focus on four areas: (i) supervisory actions; (ii) reform of restructuring, insolvency and debt recovery frameworks; (iii) development of secondary markets for distressed assets; and (iv) fostering restructuring of the banking system.
In addition to the progress report, the accompanying Staff Working Document offers a detailed overview by the Commission services’ on the progress made in the overall implementation of the Action Plan. This includes measures under the responsibility of the Commission and other institutions and agencies.
View First European Commission progress report on reduction of NPLs in EU, 18 January 2018
View Commission Staff Working Document, 18 January 2018
View Commission factsheet: Banking Union: Progress on risk reduction, 18 January 2018