Immovable properties at banks’ possession reach ALL 25b: BoA
The value of immovable properties that banks have taken in their possession at the end of the collateral execution process has reached over ALL 25 billion.
In the last five years, the value of these assets in bank balances has increased by approximately five times.
According to the Bank of Albania, these assets accounted for 2.1% of the total banking system assets at the end of 2017.
Taking possession of collateral assets usually occurs when it is not possible to find a buyer through auctions for their sale.
After the rapid growth of non-performing, banks were increasingly faced with the need to seek collateral collection through collateral execution.
But the crisis in the economy and in the property market has often made it difficult to sell properties.
This applies especially to large business value collateral, such as land or commercial property.
Due to the large property value and the limited range of potential buyers, more and more banks have been forced to take possession of these properties themselves.
Their increasing weight in bank balances has made their management a challenge on its own.
In addition to management problems and costs, these properties exacerbate expenditures in the balance sheet because banks are required to hold funds for them.
For immovable property, the value of the commissions starts from 5% in the first year to 100% aftër the seventh year of their keeping in the balance sheet.
At least, for a property valued at ALL 25 billion, it is estimated that banks spent about ALL 1.25 billion of last year’s provisions.
Realistically, figures need to be higher because a large part of these properties are on bank balance sheets for more than a year.
SCAN
*Material i përgatitur nga portali SCAN. Ripublikimi mund të bëhet vetëm kundrejt citimit të autorësisë dhe burimit origjinal.