Management and liquidation of non-performing loans in terms of execution and bankruptcy law

Banks are one of the most important actors in the financial system. The ability of banks to perform their functions properly depends on the full and timely return of loans. Banks make loans to their trusted customers believing that they will repay them. However, it is not possible for every loan to be returned on time and completely. For this reason, almost every bank has more or less non-performing loans in its balance sheet. As a result of not being able to properly liquidate the non-performing loans stock, serious financial problems occur both in the banking sector and the real sector. If the problem persists, it is even possible that a nationwide economic crisis will occur. Therefore, the management and liquidation of non-performing loans has become an increasingly important function. Different approaches can be adopted in the execution of this function. In this study, it has been tried to determine a conceptual framework for non-performing loans, taking into account the Turkish practice. Afterwards, the management and liquidation practices of non-performing loans are systematically examined under two main headings, administrative ways and legal ways. In addition, the legal qualifications of the practices in administrative ways have also been tried to be explained. Afterwards, solutions other than execution and bankruptcy law regarding non-performing loans in comparative law were examined, and finally, some suggestions were made for more effective management and liquidation of non-performing loans in Turkey.