Clearly, more needs to be done to fully unlock the potential of market-based solutions to the NPL issues. Due to asymmetric information between the investor and the seller of NPLs, and to very long duration and high cost of debt enforcement procedures, there is a wide bid-ask spread in the NPL markets. The exact data on that gap are difficult to come by.
When the economy is expanding at an unsustainable pace, pushing hard on the limits of production capacity and threatening to send the trend of inflation through the top of the target range, the Bank will tighten monetary conditions to cool things off.