Bank Loan Classification and Provisioning Practices in Selected Developed and Emerging Countries

Laurin, Alain ; Majnoni, Giovanni

Washington, DC:World Bank

关键词: BANKS & BANKING;    EMERGING ECONOMIES;    PROVISIONING;    RISK MANAGEMENT;    EXTERNAL AUDITORS;   

DOI  :  10.1596/978-0-8213-5397-4
RP-ID  :  26056

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This report reviews loan classificationand provisioning practices in a broad sample of countriesthat differ in size, location and level of financialdevelopment. The survey conducted for the report comparesthe regulatory approaches adopted by industrial and emergingeconomies, and is intended to complement other sources ofinformation that focus exclusively on either industrial ordeveloping countries. It covers classification of individualand multiple loans, treatment of guarantees, collateral andrestructured loans, bank loans review processes, loan lossprovisioning, tax treatment of loan loss provisions,disclosure standards, and external auditors' role.Differences in provisioning and classification approacheshave often made difficult a comparison of bank and bankingsystem weaknesses across regulatory regimes. Poorclassification and provisioning practices have led tosolvency ratios that gave a false sense of security, asoccurred when seemingly adequately capitalized financialsystems failed in the 1990s. Successful regulatoryharmonization therefore requires a set of minimum standardsfor loan classification that is grounded in sound riskmanagement practices, but that is also sufficiently generalto recognize differences in national economic and legalenvironment. The evidence this report provides is intendedto contribute to this difficult task.