The European Bank for Reconstruction and Development (EBRD) has launched a new website that will share information on non-performing loans (NPL) in emerging Europe, in a bid to counter the risks presented by them.

The online site will provide transparent and accessible information to public and private stakeholders.

According to the EBRD, Europe’s largest banks still hold some €1.1tn of NPLs, undermining both their stability and capacity to undertake new lending. The Central, Eastern and South-Eastern Europe (CESEE) region still contains some of Europe’s highest and most persistent levels of NPL stocks.

“While CESEE economies have gained much experience in the area of NPL resolution and debt restructuring in recent years, greater transparency and the implementation of robust NPL reform agendas are still a priority,” says the EBRD.

The website will offer a regional overview on trends in NPL vulnerabilities and information on debt transactions in a new semi-annual regional NPL monitor. The site is accompanied by a broader NPL initiative, aimed at enhancing the overall transparency and adequacy of NPL resolution frameworks, including in-country workshops, in-depth analysis of national hurdles to NPL restructuring and sales. It draws on work specific to NPLs within the International Monetary Fund (IMF), the World Bank (WB), European Investment Bank (EIB), European Commission (EC) and the EBRD.

In addition to such an initiative, the EBRD argues that national laws, regulations, infrastructures and frameworks need to support and promote efficient restructuring and resolution of distressed exposures.

“Many steps need to be taken, from creating the legal basis to supporting market-based solutions, but we believe there should not be a one-size-fits-all approach. What is needed are tailored solutions taking into account the individual burden and the specificities of any single country,” an EBRD spokesperson tells GTR.

“One example is out-of-court restructuring, where we are assisting Hungary. While generic best practices dictate INSOL and the London approach, both frameworks are completely different and divert quite a lot from the traditional best practices to adapt to the local particularities of the banking system and actual needs of the market.”