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Retail banking in CEE - Debt collection in times of crisis


Prior to the financial crisis, CEE banks focused on growth and retail lending was expanding vastly. As the crisis hit the region, credit markets froze and credit growth even turned negative in some CEE countries. Following the economic stagnation, banks throughout CEE saw non-performing loan (NPL) levels soar. Having been a rather unnoticed area during boom times, debt collection was spotlighted suddenly and turned out to be a key lever to maintain the banks' profitability.

Given the increased importance of collection in CEE, the European Financial Marketing Association (Efma) and Roland Berger Strategy Consultants, kindly supported by Volksbank International, conducted a study on debt collection in the CEE region. The objective was to compare regional players' practices and to identify key success factors and improvement potential in managing distressed debt.

The report at hand contains the study results and provides an insight into how credit institutions in CEE handle the collection of bad debt in their retail portfolios, covering the following topics:

  • The impact of the financial crisis on retail lending and loan portfolio quality across CEE countries and an outlook on the expected developments
  • An insight into the debt collection practices of banks across CEE covering processes, organizational setup, performance measurement and supporting systems
  • An overview of CEE banks' current outsourcing practices concerning collection activities and debt sale

For the study, managers of regional and local banks all across CEE were interviewed. These findings were combined with the market knowledge of Roland Berger and the insights obtained during numerous projects in the region.


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