IPAF conference aims to develop NPL market
A panel discussion is held during the first International Public Asset Management Company Forum (IPAF) conference in Seoul in this 2013 file photo. / Courtesy of IPAF
FSC Chairman Eun Sung-soo
KAMCO emerges as 'role model' among regional AMCs
By Park Jae-hyuk
Over 200 financial experts from around the world will gather in Seoul today, to discuss ways of developing the market for non-performing loans (NPL).
According to the International Public Asset Management Company Forum (IPAF), the Korea Asset Management Corporation (KAMCO), along with Asian Development Bank (ADB), will hold an international conference under the theme, “Regional financial cooperation to enhance financial stability and economic growth.”
Participants will focus on developing Asian NPL markets by harnessing the IPAF, which has grown into an international consultative body that consists of 13 institutions from six countries. The IPAF was comprised of seven institutions from five countries, when KAMCO and the ADB established it in May 2013.
“In spite of domestic and regional initiatives to strengthen financial stability, Asia remains vulnerable to external shocks and systemic risks that threaten the region's financial systems. In that regard, addressing NPLs presents a challenge for financial stability in the region,” IPAF said.
“Therefore, it is important to establish efficient NPL resolution mechanisms, as well as to develop NPL markets. We aim to lay the foundations for further regional cooperation in developing NPL markets and discuss possible steps that need to be taken in support of a regional NPL transaction framework.”
ADB Vice President Diwakar Gupta
IPAF expects its fifth international conference will continue progress in the areas of NPL resolution, market development and ultimately in the establishment of an NPL trading framework, based on the momentum forged over the past six years.
The IPAF has held international conferences in Bangkok, Beijing and Hanoi, since it held the first conference in Seoul in 2013. Through the annual event, it has boosted regional ties among its members, sharing their expertise and policy experiences in dealing with distressed assets or NPLs across Asia.
“Each year, IPAF members participate in training and conferences that bring new ideas that as a result turn into our business strategies. The IPAF also creates opportunities for us to strengthen relationships among members,” Sukhumvit Asset Management (SAM) President Niyot Masavisut said.
“From the broader and bigger perspective, this meaningful cooperation, as part of promoting economic and financial stability, will help us achieve sustainable development goals.”
IMF Senior Resident Representative for China Alfred Schipke
This year, the IPAF has come up with three sessions to achieve its goals.
The first session, beginning with a presentation by Alfred Schipke, senior resident representative of the International Monetary Fund (IMF) for China, will deal with the Asian financial sector's stability and development.
In the session, panelists will discuss policy measures to strengthen financial resilience in the region, addressing current issues related to financial stability and development.
The second session will cover the main challenges, opportunities and lessons from Asia and Europe, regarding the establishment of NPL markets.
“The experience in Europe shows there is no one-size-fits-all approach to NPL resolution,” said Reiner Martin, lead economist of the European Central Bank's Joint Vienna Institute, who will give a presentation in the session.
“A careful assessment of a country-specific situation is needed to determine the best combination of measures and which policy reforms are needed ― for example changes in banking supervision and improved insolvency laws.”
As for the final session, panelists will talk about elements and factors necessary for the preparation of the framework and action plans to facilitate the establishment of NPL transaction mechanisms in Asia.
A day before the conference, the IPAF also held a meeting attended by executives of the ADB, KAMCO and the Korea Deposit Insurance Corporation, as well as central bank officials and heads of public asset management companies (AMCs) from China, Thailand, Vietnam, Kazakhstan, Malaysia, Mongolia and Zimbabwe.
Public AMC heads said they want to continue cooperation with KAMCO, so as to learn from its experience with debt management.
“KAMCO is a role model for us in terms of national AMC. We would like to learn from KAMCO's experiences handling distressed assets during crisis and also during prosperous years,” the SAM president said.
“It is very interesting to learn how KAMCO manages to maintain the right balance between government and business roles.”
Vietnam Asset Management Company (VAMC) director Do Giang Nam said: “With the learning spirit, opportunity sharing and successful cooperation, in the coming future, we wish to continuously receive support from KAMCO in amending legal framework of debt trading market, implementing and monitoring NPL trading platform; NPL securitization; online auction of property to effectively connect with Korean investors who are interested in NPL market in Vietnam.”