Report on Operational Targets for Non-Performing Exposures
30/11/2016 - Press Releases
The Bank of Greece publishes today the first Report on Operational Targets for Non-Performing Exposures (NPEs). The scope of this report is to provide an aggregate summary on the developments of the operational targets and selected Key Performance Indicators (KPIs) that have been set by the Greek banks.
NPEs represent the most significant challenge for the Greek banking system today. Addressing this problem in an efficient manner is important from both a micro and a macro prudential perspective, since it will lead to the improvement of the financial soundness of banks and will also allow freeing-up of capital that can be directed to other more productive sectors of the economy, resulting in an increase of productivity and growth.
In this context, one of the key policy initiatives is the banks’ obligation to set operational targets for NPEs. More specifically, the Bank of Greece, in close cooperation with the Banking Supervision arm of the European Central Bank, has set up a number of action-oriented and results-oriented operational targets for NPEs, supported by several KPIs.
The reporting framework has been upgraded accordingly with the Bank of Greece Executive Committee’s Act 102/30.08.2016, so as to allow authorities to obtain on a quarterly basis a granular view on banks’ asset quality metrics and a view on actual metrics for the submitted operational targets and selected KPIs.
The Bank of Greece will publish, on a quarterly basis, a report with an aggregate summary on the developments of the operational targets and selected KPIs, in comparison to the operational targets that have already been set by the banks.
The first report, that is published today, refers to end of September 2016 data. For this first report a technical background on the targets is also included. A more detailed analysis on the evolution of asset quality of Greek banks is available in the Banking System Review (in Greek) and the Monetary Policy Reports of the Bank of Greece (in Greek).
Related link: Report on Operational Targets for Non-Performing Exposures