2. Pack and transfer. With the development of China's banking industry, there are more and more non-performing assets in the system, which consumes a lot of manpower and material resources. 199, the Ministry of Finance allocated 40 billion yuan to set up four asset management companies (state-owned AMC), namely Dongfang, Huarong, Cinda and Great Wall, to divest the bad debts of commercial banks. Commonly known as "package transfer", that is, the bad debts originally belonging to the bank are transferred to AMC through the transfer of creditor's rights. After the continuous development of domestic finance, the four state-owned AMCs could not meet the needs of bank packaging and transfer. 10 years later, local AMCs were established in various places to accept non-performing loans from local banks.
3. Write off. No matter the first or the second case, the loss of the bank's principal is basically inevitable (the creditor's rights are basically sold at a discount on the basis of the principal), and this part of the loss will consume the bank's provision, commonly known as "provision for bad debts". Write-off debts are not reflected in the table as bad assets, commonly known as "account sales and case storage", and the provisions consumed are the bank's profits, which are equivalent. If the non-performing assets after write-off are recovered, they will be directly reflected in the bank's own profits.
4. Debt restructuring. There are many reasons for enterprises to default. Not all debts are malicious defaults. Many business owners only have temporary liquidity difficulties or are affected by upstream and downstream fluctuations in the industry, resulting in temporary liquidity tension. For such enterprises that have not lost their hematopoietic function in essence, banks can renegotiate the repayment period with enterprises, give them a certain grace period, lower interest rates, re-inject a sum of liquidity to revitalize enterprises and restore non-performing assets to normal.