The 2016 SEE NPL Forum gathered more 130 participants from CESEE, confirming the importance of this topic and its significance for economic growth and investment potential of the NPL market. International and regional experts shared their insights on regional market trends, regulatory frameworks and the different state strategies for resolving the NPL issue. Panellists also discussed the obstacles and opportunities faced when investing in the SEE region.
The event provided insight and experience from regional regulatory institutions which provided an opportunity to compare different approaches of regional governments and central banks in dealings with NPLs, measures that have been implemented and their results. In the Serbian market, the strategy has focused on the development of the NPL market and making it more attractive for asset management firms.
The main challenges facing Serbia are mainly of a regulatory nature and concern actions that have to be taken in the retail NPL market, the law on real estate valuations, the tax treatment of NPLs and issues concerning banking secrecy and data protection. In Croatia, the measures taken by the Croatian National Bank are showing results, making this market more attractive for existing and potential investors. The Slovenia Central bank has applied somewhat “out-of-the-box“ thinking i.e. a direct approach in dialogue with potential investors which has led to satisfactory results in downscaling NPLs in the Slovenian market.
The regional NPL market presents indisputable investment potential (approx. 50 to 55 Billion EUR), however there are vast regulatory obstacles preventing more investors from entering the region and existing ones from making larger investments. As these obstacles are addressed, the market will undoubtedly grow and develop.