Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/229009 
Year of Publication: 
2020
Series/Report no.: 
ECB Working Paper No. 2395
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
This paper presents a new dataset on the dynamics of non-performing loans (NPLs) during 88 banking crises since 1990. The data show similarities across crises during NPL build-ups but less so during NPL resolutions. We find a close relationship between NPL problems-elevated and unresolved NPLs-and the severity of post-crisis recessions. A machine learning approach identifies a set of pre-crisis predictors of NPL problems related to weak macroeconomic, institutional, corporate, and banking sector conditions. Our findings suggest that reducing pre-crisis vulnerabilities and promptly addressing NPL problems during a crisis are important for post-crisis output recovery.
Subjects: 
non-performing loans
debt
banking crises
recessions
crisis resolution
JEL: 
E32
E44
G21
N10
N20
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-4038-2
Document Type: 
Working Paper

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