Non-performing loans are increasingly difficult to recover byspecialised companies, so they are no longer willing to pay tobanks more than 8% of the nominal value of receivables theypurchase. "If we are talking about non-secured retail loans, worthup to 30,000-40,000 RON, fees amounted to 20-25% of the receivable.Now fees amount to a maximum of 5-8%. The main reason for this isthe very low success rate. If the client was no longer able to paytheir instalments, how could they now repay a full loan? And if weforeclose on them, what do we do with the home?," says GeorgKovacs, general manager of EOS KSI, leader of the Romanian debtcollection market. The company purchased 170 million euros inreceivables from banks last year. Towards the end of the year bankscleaned their portfolios of non-performing loans, which theycovered 100% through provisions in order to improve their financialindicators, and rushed to debt collectors.
Kovacs says, however, that for them it is not easy at all toturn the assets they purchased to account. Individuals' repaymentability significantly worsened. "Whilst last year a person was ableto pay 650 RON per month on average, now they pay 400 RON per monthat the most."
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