Jakarta - NPL

Following recent updates from the market it is obvious, that Indonesian banks are within growing stage in the position of focusing on non-performing loans. As it can be seen from various sources, one of it to be Forbes magazine, are two new CEOs of Indonesian banks Bank Mandiri
and Standard chartered focosing on growth and NPL. It is for sure a main concern to growth to deal with NPL. The possible ways to deal with NPL are:
a) setup a new team in the bank to focus on NPL in house and out of house management
b) colaboration with out ot house NPL management companies due to effectivity and variable costs
c) finding the source of NPL within the bank
d) dealing with NPL by sale of risky assets
e) studying previos solutions and price for sale of NPL to government
f) preparing new products focused on targeting of NPLs (credit cards to personal loans)
g) restructuring
h) talks to shareholders directly or through media

A proper prediction, management, approach and communication of risk is essential. Many times it is much better for the bank to issue loans with NPL than not to issue loans at all. For example on credit card NPL the bank can get first downpayment of the credit card simply by the collection of the fees by seller. Second way of collecting the NPL would be a cash flow that shall be connected with credit card. Third way the bank focuses on insurance.