Case Analyses of Non-Performing Loan Investments

• Main Authors: Chang Chin Pao, 張清保
• Other Authors: Hsu, Chi-Sheng
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/26888114626630766588

碩士 === 東海大學 === 高階經營管理碩士在職專班 === 101 === This study explores benefits and costs of investments in non-performing loans (NPLs). Specifically, this study aims to help potential investors understand gains and risks in investing NPLs by analyzing the investment processes and resale models of the case company’s three NPL investments. Nonperforming loans are classified into bad debts in which financial institutions cannot collect the debts; therefore, the capital costs in investing NPLs are relatively high. Accordingly, NPL investments are regarded as high-risk investments with high returns. As the three NPL investments shown in this study, the first two cases earn highly positive profits, but the third one suffers a big loss. NPL investments could not obtain profits in a short period of time; instead, they are long-term investments. For example, each of three NPL investments in this study lasts for more than five-years waiting duration. Moreover, since the financial costs are so high that investors without certain financial capitals are not able to invest in NPLs. In other words, the features of high risks, long investment periods, and high financial costs of NPL investments limit the number of potential investors, but also present the opportunities of high returns.