Summary
This proposal introduces mandatory minimum loss coverage for non-performing bank loans to strengthen the European banking system. 10 25.04.2019
Other
finance
economy
administrative law
financial institutions and credit
Key points
- The introduction of a mandatory requirement for banks to cover losses from non-performing loans.
- A time-based system where the amount of capital a bank must set aside increases as a loan remains unpaid.
- Different timelines for coverage: three years for unsecured loans, seven years for most secured loans, and up to nine years for real estate-backed loans.
- Provisions that allow banks some flexibility in capital requirements when they grant concessions to help struggling borrowers.
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