Cyprus banks must increase restructurings
The governor of the Central Bank of Cyprus has dispatched crucial correspondence to banks and credit repurchase companies shedding light on the strategy for restructuring nonperforming loans (NPLs) and navigating credit risk management.
The primary focus is on maximizing viable restructurings, given the prevailing global economic landscape and the strains on household and business incomes. Credit buyback firms are urged to engage wholeheartedly with borrowers to identify sustainable restructuring avenues whenever feasible.
Furthermore, discussions surrounding restructuring must be characterized by agility and transparency, aligning closely with economic shifts and pertinent legislation. Swift identification of viable restructurings is not just beneficial but imperative for maintaining financial stability and fostering broader economic health, a win-win for lenders and borrowers alike.
In terms of credit risk management, the Single Supervisory Mechanism has underscored its significance for the 2024-2026 term. It is incumbent upon licensed credit institutions to ensure optimal borrower management.
