And working out NPLs can create a pipeline for future sales, where possible. However, the underdevelopment of secondary debt markets also impedes non-performing loan resolution in most of the countries surveyed. Specific obstacles in the legal and regulatory framework appear to be the cause of such a market stagnation.
This despite the fact that the majority of jurisdictions surveyed appear to have a framework favourable to transfer non-performing loans to third parties. Joint action from all relevant stakeholders – including Member States, the Commission and EU fora – is therefore critical.