New legal framework and practical issues for non-performing loans in Serbia
Non-performing loans (NPLs) have steadily risen in Serbia over the last several years. According to the latest report on the banking sector from the National Bank of Serbia (NBS), NPLs to total gross loans have risen between the second and third quarters of 2012 from 19.5% to 19.9%, and the total volume of NPLs in the third quarter of 2012 was RSD 399.5 billion (approximately EUR 3.56 billion). 59% of the NPLs were granted to companies both in the private and public sector, and more than 80% of the corporate NPLs in the private sector were related to the construction and real estate industries, again rising by 6% over the second quarter of 2012. The rising level of NPLs adversely affects the financial results and capital of banks, thus leading to increased credit risk.
Faced with this problem, the NBS amended the Decision on Risk Management of Banks (“Official Gazette of the Republic of Serbia”, nos. 45/2011, 94/2011, 119/2012 and 123/2012) in December 2012, effective as of 31 December 2012. Amendments to the Risk Management Decision allowed for the possibility of assignment of receivables from NPLs granted to legal entities by the bank to any legal entity, provided that these receivables are due for payment…
If you are registered and logged in to the site, click on the link below to read the rest of the Karanovic & Nikolic briefing. If not, please register or sign in with your details below.
News from Karanovic & Nikolic
Briefings from Karanovic & Nikolic
Tax Newsletter — Serbia: rulebooks on tax balance and tax returns for corporate taxpayers and entrepreneurs
Karanovic & Nikolic has published the March 2014 edition of its Tax Newsletter.
Croatia: recent news highlights — Strategic Investment Act and proposed new act on maritime goods and sea harbours
The new act on strategic investment in Croatia has achieved its goal of reducing administrative procedures and ensuring the speedy realisation of strategic projects in Croatia.
Analysis from The Lawyer
‘Exotic’ investors and opportunities for legal work beyond M&A feature in The Lawyer’s high-level roundtable debate on south-east Europe
Croatia is about to enter the EU, but the path to integration may not be smooth for the Balkan states