Try to understand, what is bad loan?
Outstanding under the Contract can be classified as a bad (bad loan) one if there are criteria determined for potential bad loan and one of the characteristics:
- Past-due under the Contract with the term of more than 90 calendar days;
- Stable financial incapability/unwillingness to fulfill obligations under the Contract;
- Full loss of connection with the Customer, change of address, contacts; detection of facts which are the risk of loan not to be repaid;
- Lose of collateral (alienation of collateral, declaring collateral agreements invalid, etc.).
- Initiation of bankruptcy case of the Customer/Collateral provider/Guarantor.
- If Credit Committee / Bad Credit Committee makes decision on acknowledgment of outstanding as a bad loan.