This Selected Issues paper focuses on the insolvency of the National Bank of Fiji (NBF). As of June 1995, an estimated two-thirds of its loan portfolio was judged to be nonperforming (7½ percent of GDP), with slim chances of recovery, leaving the bank with a negative net worth estimated at F$170 million. The Reserve Bank of Fiji (RBF) raised concerns about the NBF’s lending practices as early as 1991, but it lacked the power to enforce a solution. The problems continued to grow until the NBF’s liquidity position finally became untenable in 1994.
IMF Staff Country Reports