Settlement Instruments of Problem Loan Debt of Commercial Banks under War Conditions

Abstract

The relevance of the article is due to the need to search for new principles, tools and approaches to resolving the problematic loan debt of commercial banks in post-war conditions. The following research methods were used as a decision-making tool in the context of the effectiveness of measures to reduce problem loans in banks: analysis and synthesis; induction, deduction and analogy; abstraction; generalization; idealization. Measures aimed at the effective and timely solution of the problem of banking assets are considered. Modern tools to reduce problem loans have been analysed. The main schemes of work with problem assets existing in international practice are investigated. The classification of overdue debt management tools is proposed, and a comparative analysis of their effectiveness is carried out. The main shortcomings of the existing system for settling problem loan debts are identified and directions for its improvement are disclosed from the point of view of external institutional and intra-banking factors based on international experience. Attention is focused on the operational readiness of banks to manage the growing volumes of problem loans. The various ways available to banks to resolve problem loans are considered, including some of the challenges and obstacles that banks face in practice. The directions of the settlement of problem loans in banks by creating special departments are analysed. The system of choice of tools for settling bank problem loan debts is substantiated. The necessity of more targeted state policy measures to eliminate banking risks through problem loans is substantiated. There is a need for policy coordination within national NPL strategies. Recommendations are proposed for building a system for managing problem loans of corporate borrowers in a bank. The possibility of using foreign default forecasting models for the use in Ukrainian banking practice is assessed.

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