There are multiple tools available, including: re-engaging with borrowers, restructures, accounting write downs, mortgage to rent, engaging through the Insolvency Service, sales and securitisations and the legal process. A sustainable restructure is good for the borrower and for the lender. These long term benefits are not always being given sufficient prominence relative to shorter term capital relief.
1  For a more detailed account on the topic, see Nishimura, K. G., “Unconventional Policies of Central Banks: Restoring Market Function and Confidence,” Remarks at the Panel Session “Monetary Policy Boundaries: Alternative Instruments and Policy Coordination” at the Money and Banking Conference sponsored by the Central Bank of Argentina on Sept.1, 2009, available online at http://www.boj.or.jp/en/type/press/koen07/ko0909a.pdf.