A Study on Crisis Management in Bank Bad Debts－Using a Taiwan Listed Company Caseas an Example

• Main Authors: Kuo-Pin Hsiao, 蕭國濱
• Other Authors: Ku-Ho Lin
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/566yv2

碩士 === 國立中興大學 === 高階經理人碩士在職專班 === 99 === Loan service is one of the most important activities of a bank, which is also the major resource of profits. Therefore, the level of NPL ratio is an important measure of a bank’s credit quality and its profitability. However, due to the global economic downturn, relocation of domestic enterprises, Asian financial crisis, structural changes of local banks and the competition of financial liberalization, many Taiwan financial service organizations have faced high NPL ratio, which lead to operational difficulties in recent years. Ideally, banks should have their own approaches and criteria in their credit management system and branch managers have to follow the SOPs in dealing with the issues. However, there’s a huge gap when it comes to real practice. Such situation can cause the rising of overdue loans, bad debts and the malfunction of the whole system. When a problem occurs at enterprises loans, the crisis management ability of a bank plays the key role of its solution. Crisis can be a turning-point. If effective risk management are properly done in the first place of the loaning, the win-win situation is more possible for the bank and the enterprises. This research based on case study of a listed company in Taiwan, discussing the crisis management of a bank. This study concluded that the principle of ‘5P’ can be employed while not only evaluating enterprises loaning, but also dealing with the bad debts. As long as the initial assessment are properly done, the bad debt rate shall be lower afterwards. On condition that a bank can make use of the critical time, it can surely solve the problem and escape the fate of closing down.