On EU non-performing loans (NPLs) my understanding is there is a still a €780b overhang. This is the reported value at current interest rates. I can't say what the value would be if rates climb a tad.
Talking heads are cheering because the reported value of NPLs has been declining with the transfer of significant volumes to "bad bank" ledgers from where they are packaged up and sold to PENSION FUNDS as CDOs (CLOs for those who weren't covering this stuff 10 years ago).
As I see it the non performing part of the the packaged up financial instruments must still be there. Will they do well? That depends on their composition and the relative growth prospects of the businesses they represent.
cheers
