Kazakhs Need Bad Banks to Cut Loan Delinquency, Kelimbetov Says - Bloomberg

Kazakhs Need Bad Banks to Cut Loan Delinquency, Kelimbetov Says - Bloomberg:

"Kazakhstan needs bad banks to reduce the world’s worst delinquency rate in its financial industry, central bank Governor Kairat Kelimbetov said.
Kelimbetov, who took over at the helm of the Astana-based regulator in October, said in an interview in London yesterday that his main mission is to help transform the banking industry’s “architecture,” which proved vulnerable in the global financial crisis. His goal to cut the non-performing loan ratio by two thirds to 10 percent is realistic by January 2016, he said.
To complement an existing distressed-asset fund, “we have to establish bad banks to pass the bad debt to special collector agencies,” he said. “Banks should be responsible for their core business of providing loans and they also have to clean up their balance sheets. Otherwise, there will be zombie behavior by the banks, not providing loans to the economy and not writing off these bad loans.”"

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