Non-Performing Loan Recovery: The Case of Mongolia

In this study, the activities related to the recovery of non-performing loans were

considered in case of “Savings Bank” LLC. According to the survey, it takes an

average of 4.2 years to recover non-performing loans, and recovery rate is on

average 83 percent. The recovery rate of loans has been declining over time despite

the fact that it was high in the first years of the receiver's appointment. Furthermore,

the amount of non-performing loans recovered out-of-court was relatively small

compared to the amount of that recovered through the courts. Although in-court

activitiesto recover the non-performing loanstakes 1.3 years more than out-of-court,

the recovery rate is 7% higher in terms of judicial proceedings.

JEL classification numbers: G21, G29, G33.

Keywords: Non-performing loans, Recovery rate, Banking sector.