Cover IMF Working Papers
Loan Review, Provisioning, and Macroeconomic Linkages
Author:
International Monetary Fund
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Series:
IMF Working Papers
Volume/Issue:
Volume 2000: Issue 195
Language:
English
Publication Date:
01 Dec 2000
DOI:
https://doi.org/10.5089/9781451859904.001
ISBN:
9781451859904
ISSN:
1018-5941
Pages:
32
Keywords:
WP; loan valuation; loan review; restructured loan; bank supervisor; bank behavior; loan takedown; loan value; Nonperforming loans; cyclical bank behavior; capital ratios; loan quality; loan provisioning; Loans; Capital adequacy requirements; Loan classification; Credit; West Africa
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Loan review is a process routinely used by banks to assess the current value of loan portfolios. Provisioning is a technique to translate loan review results into the balance sheet. It allows for ongoing valuation of loans. Both are core elements of credit risk management and important to prudential oversight. As illustrated in this paper, valuation feeds into indicators of overall bank soundness and key macroprudential indicators. Country practices and recent moves to more forward-looking models are surveyed. Macroeconomic linkages are highlighted, including tax treatment of provisions, variables of the monetary survey, and procyclical aspects of loan valuation systems.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 2000: Issue 195