The collection of non-performing assets refers to the process by which banks or other financial institutions recover the principal and interest of loans and accounts receivable that are overdue, sluggish or doubtful through certain procedures and measures. Non-performing assets usually arise when the borrower fails to repay the loan on time for various reasons. When banks are faced with non-performing assets, they need to adopt effective collection methods to reduce risks and maintain financial stability. Here are some common ways to clear non-performing assets:
1.Collection: This is the first method that the bank will take, including ** collection, letter collection, door-to-door collection, etc. Banks will remind and urge borrowers to repay their loans on time in different ways.
2.Legal action: When collection fails, the bank can take legal action to recover the non-performing assets through court proceedings. This includes filing a lawsuit, applying for a payment order, applying for arbitration, etc. The statute of limitations is 2 years, starting from the time of interruption.
3.Asset preservation: Protecting the bank's rights and interests in the litigation process by means of sealing, seizure, and freezing of the borrower's property.
4.Transfer of non-performing assets: Banks can package non-performing assets to asset management companies or other investors to transfer risks and obtain a certain amount of cash flow.
5.Asset restructuring: For borrowers who are willing to repay but have temporary difficulties, the bank can negotiate with them to restructure the debt, adjust the repayment period, interest rate and other conditions.
6.Assetization: Package non-performing assets and convert them into tradable assets, financing and risk diversification through the capital market.
7.Outsourcing collection: Banks can delegate the collection of non-performing assets to external institutions, such as law firms, asset management companies, etc.
8.Pure channel mode: The non-performing assets are temporarily removed from the balance sheet through the channel institution, and the actual risk is not completely transferred. The specific operation is that the bank first sells the non-performing asset package, and then signs a repurchase agreement with the buyer or recovers the beneficiary rights of the non-performing assets through income swaps.
9.Cooperative disposal: Banks cooperate with other institutions to jointly dispose of non-performing assets and share risks and benefits.
The process of non-performing asset collection needs to comply with relevant laws and regulations and fully protect the legitimate rights and interests of borrowers.
In the process of liquidation, banks should follow the principles of authenticity, timeliness, prudence and independence, effectively resolve asset risks, and maintain the stability of the financial market.