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Category: ABS NPLs

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CSEE moratoria more likely to underperform

EU banks set aside large provisions in 2020 in anticipation of Covid-induced higher default rates, but most loans that benefited from payment holidays in the region resumed regular payment schedules during 2020 with less than expected difficulty. However, the credit performance of loans exiting moratoria weakened in the last quarter of the year, indicating that loans under long-running moratoria are more likely to underperform.

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