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Article (12): Non-Performing Assets and Write-Off

C 3/2024 Effective from 25/7/2024
12.1
LFIs must establish a strategy to manage non-performing assets and avoid maintaining elevated stocks of non-performing assets. This strategy must be approved and regularly reviewed by the Board, and be achieved by maximising recoveries and implementing timely write-offs. The strategy must be fully embedded into the management process of the LFIs and be the subject of regular reviews.
 
12.2
When the LFI has no reasonable expectation to recover the full or part of a facility exposure as per the terms of the legal agreement, it should undertake a full or partial write-off of that exposure.
 
12.3
The LFI must ensure that write-offs are timely and reflect realistic payment and recovery expectations.