不實債權 整理를 爲한 法的基盤에 관한 硏究 : 國際 標準化를 中心으로 = (A) Study on the legal infrastructure for the resolution of non-performing loans("NPLs") : focusing on international standardization

국문 초록 (Abstract)

우리나라를 포함하여 1997년 금융 및 외환위기로 인하여 경제위기를 겪은 동아시아 국가 등 대부분의 신흥시장 경제 국가와 채제전환국 및 일본의 부실채권시장의 공통적인 특징은, 경제위기로 인해 발생한 부실채권을 처리하기 위해 정부가 설립한 공적기관의 주도 하에 부실채권정리작업이 추진되어 왔다는 점이다. 이들 국가에 있어서 不實債權의 조기정리를 위한 법적 제도적 인프라가 미약하여 민간부문이 부실채권정리에 효과적으로 대응하지 못하였기 때문이다.
본 논문에서는 주로 우리나라, 일본 등 금융시스템의 비효율성으로 경제위기를 겪었거나 현재 겪고 있는 나라와 중국과 같은 체제전환국 및 말레이시아와 같은 신흥시장경제국가들의 현실적인 부실채권정리 법제 하에서, 부실채권정리 활성화를 위해서는 國際標準化가 필요하다는 當爲性을 규명하고 이를 위한 구체적 방안을 연구하고자 한다.
국제표준화란 일반적으로 여러 나라 사이에 통용되거나, 또는 여러 나라를 포괄하여 마땅히 따르고 지켜야 할 본보기나 법식, 또는 제도를 의미한다. 국제표준화의 명제를 부실채권에 관한 법제를 국제적 규범으로 만드는 노력을 경주하여 부실채권정리 시장 내에서 공정거래가 이루어지고 부실채권이 효율적으로 정리 되도록 함으로써 부실채권정리의 국제협력을 통하여 세계경제의 활성화를 도모하자는 차원에서 접근한다.
경제가 글로벌화해지면서 각국의 경제에 있어 금융도 글로벌화되어 가고 있다. 이에 따라 어떤 나라의 금융의 부실은 이웃나라의 부실로 이어지는 同時化現像이 나타나고 있다. 이러한 점을 감안할 때 세계경제 전체의 금융구조의 건실화를 위한 방안의 모색은 불가피한 것이다.
이를 위해서는 부실채권정리가 현안이 되어 있는 개별 국가가 자주적으로 부실채권정리문제를 이미 경험한 선진제국의 제도나 최근 모범적인 정리실적을 보인 국가의 제도를 도입하는 경우도 있을 수 있겠으나, 이 보다는 국제적인 협력을 통해 이러한 제도의 도입을 여러 나라에 적극 확산함으로써 부실채권시장을 육성하는 것이 각국의 경제, 나아가서는 세계경제의 안정적인 성장의 밑거름이 된다고 생각한다.
부실채권정리관련 법제의 표준화는 다음의 두 가지 방향에서 모색할 수 있을 것이다. 첫째는 자국의 부실채권정리에 있어서 성공적 성과를 거둔 국가의 제도와 경험을 공유하도록 하는 방법이다. 성공한 사례로서 예시된 국가의 제도를 국제모델화하여 러시아, 중국, 인도네시아 등과 같은 體制轉換國이나 신흥경제국가에 전파하도록 하는 것이다. 둘째는 국제금융 및 자본시장에 있어 부실채권에 대한 투자여건을 개선하는 방법이다.
국제표준화는 지역적으로 이루어지거나 또는 범세계적으로 이루어지는 경우로 나누어 볼 수 있으나 대부분의 경우 일부 지역 또는 국가에서 먼저 형성된 국제규범이 점차 다른 국가나 지역으로 전파되는 경로를 따르게 된다. 또한 각국의 고유한 문화나 법체계의 특성을 감안하여 논의가 전개되어야 하며, 실효성과 법적 안정성으로 대표되는 상충하는 가치에 대한 비교형량의 과정이 뒤따르게 될 것이다.
구체적인 추진방안에 관해서는 韓國資産管理公社의 경험이 유용할 것이다. 즉 한국자산관리공사는 상대방 국가의 공적기구와 상호 제도연구 및 통일화를 위한 노력을 경주한다는 양해각서를 교환하고, 나아가 국제적인 협력체계를 구축하기 위한 국제포럼의 개최를 주도적으로 수행하였다. 이와 같은 한국자산관리공사의 역할은 부실채권 정리에 관한 국제적인 룰을 형성하는데 있어서 긍정적이었던 것으로 평가할 수 있다.
표준화에 관하여 모델의 구체적인 내용은 어느 한 나라의 제도에 전적으로 의존하는 것보다는, 각국의 제도를 다각적으로 연구하여 하나의 모자이크법을 구성하는 것이 바람직할 것이다. 실제 모델법령에 수용하여 각국에 전파할 가치가 있는 것으로 판단되는 제도는 그 동안 제도운영의 결과가 비교적 성공적인 국가의 것들이다. 이러한 점에서 한국, 말레이시아 또는 미국의 제도는 특히 본받을 가치가 있는 것으로 생각된다. 이들 국가의 부실채권정리제도의 공통점은 정부 또는 공적기구가 강력한 권한을 가지고 공적자금을 활용하여 부실채권을 신속하게 정리하고자 하였다는 점이다. 이러한 접근방법은 부실채권시장의 형성·발전단계로 보아 제2단계 내지 제3단계에 해당하는 것으로 완숙한 시장의 기능에 의존할 수 없는 특수한 상황을 전제로 하는 경우일 것이다.
이상의 논의에 기초하여 볼 때, 모델법령의 내용에는 不實債權의 基準과 範圍에 관한 사항, 부실채권정리 재원의 마련을 위한 제도 및 각종 절차의 單純化 및 統一化에 관한 사항들이 반영되어야 할 것이다.

다국어 초록 (Multilingual Abstract)

This paper investigates regulatory policies in the resolution of the NPLs. The researcher also studies about legal approaches in the resolution of NPLs in order to make the NPLs resolution process more effective and to vitalize international economy in the long term. Also, this paper suggests that international standardization of relevant legislation is an important way to resolve the NPLs more effectively.
It is important to improve the efficiency in the financial sector of an economy so that the market can function effectively. Efficient asset management is one of the most important factors in order to achieve the stability in the financial sector. Too much NPLs held by the financial sector not only leads to the bankruptcy of individual financial institutions but also shrinks the overall business activities in the financial sector.
Furthermore, if the situation gets worse, it would weaken the competitiveness of the financial businesses, and eventually lead to a credit crisis at the national level. It also can hinder the solidity of financial infrastructure. Considering the trend of internationalization and liberalization in the financial market, the resolution of NPLs is very important for the sound management of banks and the stable management of the national economy.
In this regard, in emerging market economies such as Korea and Malaysia including South East Asian countries, the successful disposal of NPLs is very important for sustainable economic growth in the future. In order to resolve NPLs effectively, private NPL resolution agencies need to play an active role in the market.
NPLs are relatively more difficult to be evaluated than normal performing assets, and they need to be handled in sophisticated ways. In nature, NPLs are difficult to be sold in the normal asset transaction market. Considering these characteristics of NPLs, many countries have established special institutions for the resolution of NPLs. In countries like the U.S.A., Germany, U.K., where financial markets are well developed, there are plenty of private asset management companies and investment companies.
In some countries other than those mentioned above, governments are establishing public companies for the resolution. NPLs market constitutes of three entities: the provider who helps to dispose NPLs; the broker-dealer who wants to make the transaction; and investors either institutional or individual as the final consumer. Countries which experienced the financial crisis in 1997, including Korea and other East Asian countries, have established government-driven public institutions to resolve NPLs.
In those some other countries mentioned above, it was proved in general that their private sectors are relatively inefficient in resolving NPLs, and the inefficiency originates from the weakness of their legal infrastructure to a significant degree. Thus, the resolution of NPLs are planned and executed by public institutions at the government level. Government-led resolution of NPLs has some advantages in terms of transparency, expertise, and independency in the process compared to that managed by private companies. However, this also means that there could be difficulties in evaluating the fair market value of NPLs.
Investors in the international financial market consider many things before making decisions to invest in the NPLs of foreign countries. They are the potential profitability and the stability of the market, etc. The legal infrastructure as well as tax benefits are also considered seriously. In addition, the following aspects are important; whether investors can manage the liquidity and risks of their investment in the local securities market; whether financial institutions are well equipped with techniques to increase the liquidity of acquisition asset; whether there are lots of human capital with expertise; whether the system for information transmission and management is effective; whether regulatory systems for the corporate split-up, mergers & acquisition, reorganization, and liquidation as well as those for the protection of investors, including regulatory alleviation and corporate disclosure are well built.
For the newly emerging market economies such as Korea, Japan, and South Eastern countries to attract investors effectively, more efforts need to be made to establish such infrastructures.
This paper researches about regulatory policies for the resolution of the NPLs, of several countries especially United States, Korea and Malaysia, which at some time in their history experienced economic crisis due to ineffective financial system. Also, this paper takes into account the fact that newly emerging economies such as China and Eastern European countries need to develop practical regulatory policies to resolve NPLs. The researcher tries to find solutions for the betterment of the process resolving NPLs in legal a perspective. Also, this paper points out that international standardization is necessary for the development of the systems for the resolution of NPLs.
International standards could be defined as the exemplary model or system to be applied in the international level. In this paper the researcher approaches the issue of resolving NPLs in terms of enhancing fair trade and inducing decent growth in the international economy. Effective resolution of NPLs through global cooperation would lead to the stabilization of financial systems and would eventually lead to the international economic growth.
Financial system in a society is often compared to the blood circulation in human body. Financial insolvency can result in the economic crunch in a society. It can be compared to the phenomenon that hardening of arteries cause the human body to collapse either gradually or all of a sudden.
In general, the phenomenon that the barriers to the flow of the economic transactions are abolished leads to the financial globalization. In accordance, the financial crisis in a country consequently can lead to the financial problem in the countries which have economic relations with the country in trouble. Considering the ever deepening of globalization in the financial transactions, it would be the most imperative to search for effective ways for the stabilization of the international financial system. As a way for that purpose, solidification of the system to resolve NPLs especially through international cooperation would be very helpful. This will also contribute to the sustainable growth of world economy as well as to the enhancement of economic stability of each country.
On the other hand the financial system of each country which includes the system to resolve NPLs is inter-related with those of other countries. So building up the effective system to resolve NPLs would not be a simple agenda restricted to in a few countries, considering the inter-related nature of financial system at the global level.
This paper explores systematic ways to improve the problem of NPLs with an emphasis on regulation. For example, if issues like adjustment of double taxation and the free movement of international capital could be improved, NPLs could be resolved more efficiently worldwide.
Two approaches could be taken in the discussion of the internationalization of legal system with respect to NPLs resolution.
First, it would be helpful to share individual nation's regulatory policies and experiences in the resolution of NPLs. Successful examples in the resolution in some countries such as Korea and Malaysia could be followed by other countries such as Russia, China, and South Eastern countries, where the legislative efforts with respect to NPLs resolution are rather limited.
Second, it is important to improve the attractiveness of NPLs as investable assets from the perspective of investors in the international and financial markets. NPLs may be considered as an attractive investment by domestic and international investors if they can show good points in the aspects such as profitability, stability and liquidity. In reality, foreign investors have experienced lots of difficulties in the foreign markets since each country has its own special system and criteria for the resolution of NPLs, especially in terms of government regulation on the capital flow. More specifically, in countries where NPLs accumulation is huge that they cannot resolve them effectively with domestic capitals, the strong government regulation has been a pivotal problem.
In such countries, it would be helpful for the government to revise the system so that foreign investors can invest their capital actively in the NPLs market without any doubt that they are not compete under fair condition. For foreign investors, reasonable regulatory system is one of the very important factors for the decision of investment.
In nature, each NPLs market has its own particularities. Thus, it is necessary to consider the history and circumstances of each country when the government establishes the legal system for the resolution of NPLs. In general financial systems of a country are affected by its particular circumstances. Therefore, it is important to consider individual nation's specialties even if the internationalization of NPLs-related legislation is sought after. In this regard, we might be able to learn lessons from the GATS financial clauses of the WTO. The GATS financial clauses prepared during UR negotiations point out that the opening of the domestic market in the financial service sector needs to be based on individual nation's measures and systems. It clearly indicates that each country needs to recognize the differences in other nations' financial regulatory system.
International cooperation is essential in the process of harmonizing different financial systems. In order to achieve this goal, it is necessary to recognize other nation's governmental regulations and to consult over the differences with each other.
Harmonization of different financial systems which actually resluts in the standardization can be facilitated through international cooperation for mutual exchange of information, sharing common regulation, or establishment of new international organization for standardization and fund raising.
In this regard, this paper explores the possibility of enhancement of international standardization in the resolution of NPLs. This paper also emphasizes that it is important for individual nations to recognize other countries' legislative history and economic circumstances in order to facilitate international standardization.
This paper explores the possibilities of international standardization by classifying participants in the NPLs resolution market. The participants in NPLs market can be classified into provider, consumer, and broker-dealer.
The providers are public organizations which purchase NPLs from various financial institutions and then resolve through direct selling. Investors as consumers own capital resources. Usually, these entities include asset securitization company, REITs, Corporate Restructuring Company(CRC), and Corporate Restructuring Vehicle(CRV). Dealers and brokers include security companies taking care of security acquisition and sale, consulting firms and accounting firms providing financial advice, credit rating agencies, and law firms as legal advisor.
NPLs are provided by the financial institutions which are creditors to the debtors in trouble. Theoretically creditors can wait until the maturity date to exercise relevant legal interests, or they can go through certain procedures of loan securing by attachment. However, through a well developed NPLs resolution system, creditors can give debtors the opportunity to restructure companies. The creditors can also have opportunity to liquidate capital resources. It would also mean a new investment opportunity for general investors. What's important in this process is whether the debtor can actually pay for the original debt.
Financial institutions first evaluate whether the loan is insolvent or not, and then they take care of the loans in a number of ways. Public resolution agencies undertake NPLs from financial institutions and then resolve them. In this process, financial institutions and public organizations follow domestic standards in evaluating the nature of NPLs and in resolving them.
Financial institutions and public resolution agencies usually dispose the NPLs by issuing ABS, international bidding, individual disposition, or establishing joint venture company (AMC).
While going through these processes, investors naturally weigh the future cash flow. Matters of weight and importance include credit line or credit enhancement through warranty, future expected exchange rate, transferability of capital gain, and statutory stability in the resolution of legal conflict.
For a reasonable price to be established in the market, appropriate regulatory systems need to be in place. First, it is necessary to maintain effective relationship among banks, public organization, and the government. In order to achieve the effective relationship among different entities, it is necessary to ensure autonomous management in financial institutions as well as efficiency and transparency in public organizations.
Next, NPLs as goods in the market need standardized criteria for accurate evaluation. It would be helpful to have consolidation of international standard and the establishment of credit screening(review) system. Furthermore, accounting standards in corporate enterprises and financial institutions need to be approximated to the international accounting principles.
The disposal of NPLs could be pursued in the following area; issuing ABS, international bidding, individual disposition, and establishing joint venture company.
The resolution of NPLs would be more active if NPLs are in the form of ABS. For issuing domestic ABS, it is required to go through the listing and disclosure process. Also, ABS laws regulate the conditions and procedures. However, in Korea, issuing ABS to resolve NPLs was not proved to be effective in attracting foreign capital. In order to attract international investors, internationalization in the credit rating system would be a key factor.
Legislative efforts need to be placed in order for the ABS companies to ensure their rights for the credit. In the long term, securitized NPLs could be listed in the security market, if the international credibility of listed information increases. In this case, the value of NPLs as an object for investment would become higher.
International bidding method has been used in Korea, U.S.A., Thailand, and Indonesia. Considering the competitive nature of bidding, this method could maximize the value of NPLs. Also, it is an effective way to let foreign investors know the value of NPLs.
The process of international bidding needs to be standardized to minimize the purchase deposit and the cost associated with the process. This would results in the magnification of the subject assets and the mitigation of oligopoly behavior of major investment companies.
Individual disposition includes Merger and Acquisition, individual Corporate Loan Sale, etc. This is a method often used in the U.S.A., Thailand, and Indonesia. Individual disposition is influenced by conservative legislation in each nation.
As a part of NPLs, real estate properties or collateral of insolvent companies could be resolved through independent auction or court auction. Foreign investors could participate in the auction. Increasingly, there is a trend in many countries to allow for foreigners to acquire real estate properties. Regulations need to be made clear for the realty and credit related matters. However, regulations about real estate properties is usually based on individual nation's legislation and tradition. Thus, it would not be easy to pursue international standardization in this area. However, it is possible to explore ways to internationally circulate asset securities with the guarantee of NPLs and real estate properties.
This is a method to establish asset management companies, corporate restructuring companies, or corporate restructuring vehicles as a joint effort between organizations which own NPLs and international investment organizations.
When a foreign investment company establishes an AMC with an organization which owns NPLs, the price of NPLs could be increased, since the foreign investment company operates the capital market without intervention from the government. Foreign companies with capitals could participate in the NPL market, and they would expect to see the internationalization in issuing ABS.
Corporate restructuring companies specialize in corporate undertaking, normalization of management, as well as direct selling. When CRCs are established by a joint effort between companies retaining NPLs and foreign investment companies, there are a number of advantages of using the know-hows and the capital of foreign investment companies. This case also requires the internationalization of related legislation.
Investors as consumers of NPLs exhibit variety in terms of the transaction method and level. Realistically, the ultimate capital sources are domestic/international fund or financial institutions.
Providers use either direct transaction with them or use intermediate buyers to make deals. Intermediate buyers are usually private enterprises who work within the market mechanism. In Korea, they are asset securitization companies, REITs, Corporate Restructuring Companies(CRC), and Corporate Restructuring Vehicle(CRV).
Because of the high risk factors involved in the intermediate buyer structure, the intermediaries are entitled to have privileges in the contribution and assumption of liability. There are not many international players in the market, since investing in Non-Performing enterprises entails high risk factors. However, considering the increasement of vulture fund in the international capital market as well as in the junk bond market, a similar trend in the corporate restructuring market could be expected.
When the final consumer is the foreign capital, the mitigation of various regulation becomes an important issue. For example, it would be attractive for foreign investors to see less regulation on foreign exchange trade, as well as a better system to ensure the stability of foreign exchange market. On the other hand, NPLs market has some speculative factors. When international Hedge Fund (Hot money) comes in, the market could be dominated by the Hedge Fund. In order to protect the market, policies need to be made.
Consumers are expected to participate in the market under the principle of fair competition. Fair trade laws could provide regulation against mutual prearrangement or the spread of unfair information. Basically, efforts need to be made to maximize investors' participation through securitization, rather than through individual disposition.
In general, brokers/dealers are not the direct participants in the transaction, but they provide with services to close the deal. In the NPLs resolution market, brokers and dealers work as intermediaries between the provider and the consumer. For providers, they exhume consumers with enough capital. For consumers, they provide with information about the goods.
In Korea, security companies, credit evaluation companies, consulting firms, and accounting firms offer this service. These institutions provides with expertise to the market and they follow restricted laws in each nation. To protect investors in individual countries, operation process regulations and ethical regulations are written. Under certain circumstances, they have legal responsibilities. International standardization in this involves improvements in regulatory systems. The evaluation of NPLs is an important process from the perspective of investors. There are many risk factors due to the high uncertainty of NPLs. Insurance is one way to prepare for the possible dispute in the future, even though the insurance premium could reduce the earning rate. When not insured, it would be more difficult to prove a causal relationship in the case of a claim for damages.
In pursuing the international(Global) standardization of relevant legislation, it is necessary to determine who would be the entity in charge. Generally, the international(Global) standardization in relevant legislation is processed either by a joint effort of a number of nations, or through an existing international organization. As a practical approach, the international standardization could be pursued and established in certain parts of the world and it could be transferred to a larger area to include more countries.
The nature of international standardization would be different, depending on individual nation's circumstances in which the process occurs. For example, the process would results in a very different economic regulations in different countries, based on the cultural and social-economic contexts. Even though the principle of the financial market would expect to see the maximized standardization of financial transaction in as many countries as possible, the circumstances in which each country's financial market operates are important factors to consider in reality.
Therefore, the process of pursuing international standardization needs to take a number of different and cautious approaches.
First of all, it would help to examine the international standardization in the field of general economic regulations in exploring possibilities of the international standardization in resolving NPLs.
The international standardization of economic regulations can be categorized into two: 1) the establishment and transfer of the standards; and 2) the bilateral agreement between two parties. Again, The autonomous acceptance of the international standard could be accomplished by the following four ways: 1) Governments could cooperate to standardize the procedures; 2) Governmental agencies of private institutions residing in different countries could standardize the procedures; 3) A model of agreement could come to a conclusion among different countries; and 4) A model of domestic regulations could be transferred to other nations. Also, more directly, international standards could be set up through both parties agreement or multi-parties agreement.
Governmental agencies of private institutions residing in different countries could standardize the procedures. Examples include: Capital Adequacy ratio of the BIS, Bank of International Settlement; and the Labor Standard of OECD.
The Capital Adequacy ratio of the BIS(Bank of International Settlement) is an agreement between the Presidents of central banks in Western developed countries. The ratio has been set for the standardization of the process in financial supervision. It entails mandatory power.
A model of agreement could be proposed among different countries. An example would be the model of tax agreement, including the UN model and OECD model. The U.S.A. has its own model of agreement. The U.S.A. model exerts strong influence on the counterparts in terms of the mandatory power.
In the case of the UN model, the perspectives of the developing countries are well represented. The OECD model generally represents the perspectives of developed countries. With the trend of valuing free market system, the OECD model is observed in these days. The model of tax agreement plays an important role in the international business environment.
The Bankruptcy Act in association with the corporate restructuring has shown the trend of international standardization. In a broader concept, the resolution of NPLs includes the liquidation of insolvent companies and corporate restructuring. The regulations on the restructuring of insolvent corporations in Korea are the bankruptcy-related 3 acts and the Corporate Restructuring Investment Company Act. There also is an international trend of integrating many different bankuptcy-related acts into one. First of all, the UNCITRAL(United Nations Commission on International Trade Law) proposes a model law as a guideline. This is important in two ways: 1) It shows the integration of bankruptcy-related acts. Individual acts are integrated in order to restructure corporations more effectively. The international standardization of this law will facilitate more active international capital shift.
Korea is in the process of establishing the Integrated Bankruptcy Law, considering the international trend. Also, a number of South Eastern countries are making efforts in this area.
The resolution of NPLs expects to realize the establishment of the NPL market and related regulations. The resolution of NPLs has the trade-off problem as in other general regulations. The efficiency and speed in the process of the resolution of NPLs need to be ensured as well as the protection of rights for involved entities and the pursuit of legislative stability. Also, in the practical regulation, vested interest of the participants needs to be protected. Individual nations need to decide where they want to put more emphasis.
The international standardization of relevant legislation in resolving NPLs could be pursued in various ways. Efforts for fundamental cooperation constitutes of the exchange of information and the introduction of different systems. Then, efforts need to be put in the establishment of similar regulations, transfer of model laws, establishment of international agreements. Mutual support program would be effective in the fund raising as well.
Public organizations among different countries can exchange an MOU(Memorandum of Understanding) in the process of the international standardization of relevant legislation. An MOU have legal validity, similar to the cases of agreement. Generally, an MOU is made as a subsequent measure or a follow-up measures. However, an MOU among private organizations are not legally mandatory.
The KAMCO in Korea have established a number of MOU with public organizations in many different countries. They constitute the following : 1) the resolution of NPLs through cooperative work; 2) Annual conference for the promotion of business exchanges; 3) Experience sharing for the resolution of NPLs; 4) cooperative work for establishing marketing strategies for the insolvent asset; and 5) the rule of confidentiality obligation, legal consequences, and termination of MOU.
An international forum was held to pursue international cooperation among public NPL resolution agencies in Seoul, November, 2000. Representatives from 31 countries participated in the forum, including international organizations such as World Bank, Asia Development Bank, International Monetary Bank, and International Investment Bank. An international forum could be effective in the long-term development.
With the cooperation and understanding among public NPL resolution agencies in different nations, it would be helpful to set up a system for exchanging asset information. International investors as well as domestic investors would like to collect information before entering the market. This is an approach taken by KAMCO in Korea, and it is a realistic way of pursuing the resolution..
The effectiveness of an MOU will be greater when Public organizations in different nations have realistic and practical rights within the government and financial institutions. The effectiveness of this method depends largely on whether the parties concerned on agreement have influential power in the international society. The Basel Committee on Banking Supervision, which is recognized as having international expertise, set up the BIS standard, and it exerts great influence in the world.
In countries where public organizations play important roles, the MOU between public organizations would exert greater influence. In general, individual governments in the process of resolving NPLs establish public organizations on a temporary basis or increase the fund of existing organization.
Therefore, governments need to play more active roles in resolving NPLs. Thus, cooperation among international financial institutions are required in order to facilitate mutual understanding and to establish more solid financial structures in turn.
The systems to resolve NPLs usually take the forms of substantive laws or procedural laws. In substantive laws, the resolution of NPLs include the establishment of priority for loans, SPC(Special purpose companies), trust system, ABS, and tax support. These privilege clauses maintain the stability of existing legislation and effective resolution of NPLs at the same time.
In procedural laws, it is possible to organize meetings of creditors or a general meeting of stockholders for the purpose of solving legal conflict. Also, it is possible to simplify the procedures of loan assignment. The movement of legislation in resolving NPLs usually take the form of special laws. Individual nations make legislation under their own circumstance. However, since the globalization of international economy develops rapidly, it is increasingly more important to consult foreign countries' legislation.
Existing international organizations such as OECD, BIS, IMF or ADB could play important roles in the process. In addition, it is necessary to explore the possibilities of giving legal and mandatory power to the international regulations through multi-parties agreement.
In establishing a model law, it would be necessary to examine different systems in many countries. This process entails the consideration of particular circumstances in which different nations operate. Then, it is desirable to prepare a number of model laws so that individual nations could select the best possible choice. Model laws could be developed according to the development stage of different NPLs markets. Model