ALGIERS/WASHINGTON, D.C., September 29, 2004—
The International Finance Corporation, the private sector arm of the World
Bank Group, today organized a one-day conference in Algiers: “Best Practices
in Management and Recovery of Non Performing Loans”.
Non-performing loans management and recovery is unanimously recognized
as a key problem for Algerian banks, mostly state-owned institutions, whose
bad debts were restructured several times, including most recently by the
Algerian treasury. The inefficiency of non-performing loans management
among local banks partly explains the slow growth of loans outstanding
in Algeria. An improvement in this area would boost profits in the banking
sector over the short term, and help encourage greater lending activity
over the medium term.
Some 80 commercial bankers, government officials, representatives of multilateral
and bilateral programs, private sector, and top consulting firms attended
the conference, held at the National School of Administration. Abderrahmane
Benkhalfa, the President of the Algerian Association of Banks and Financial
Institutions, opened the conference.
The conference addressed topics such as non-performing loans management
within the framework of Basle II guidelines, proactive portfolio management,
role of MIS in the optimization of the recovery process, and various local
and international experiences in non-performing loans management.
“To aggressively market lending products, financial institutions need
to be confident in their capabilities to manage the associated risks“,
said Sami Haddad, IFC director for Middle East and North Africa. He added,
“By encouraging the development of sound workout practices, IFC participates
in increasing access to finance for the private sector.”
Mr. Abderrahmane Benkhalfa added," We count on IFC's support to disseminate
best practices in banking in Algeria, as well as partnering with us on
removing bottlenecks in the banking environment."
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in developing countries,
helping to reduce poverty and improve people’s lives. IFC finances private
sector investments in the developing world, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY04, IFC has committed more than $44
billion of its own funds and arranged $23 billion in syndications for 3,143
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY04 was $17.9 billion for its own account and $5.5 billion held
for participants in loan syndications.