FINANCE FORUM 2004

1

• FINANCE FORUM 2004
• Workshop
• DESIGN CHALLENGES OF NATIONAL AMCS
• September 22, 2004
• PANEL
• Thomas A. Rose, Advisor, EASFP
• Kiatchai Sophastienphong, Sr. Financial Sector
  Specialist, SASFP
• Michael Edwards, Principal Financial Advisor,
  ECSPF
• Sameer Goyal. Sr. Financial Sector Specialist,
  EASFP

2
Why do countries consider establishing AMCs?

• They can potentially
• reduce NPLs in the system
• maximize loan recoveries
• speed up enforcement of collateral by banks

3
Key questions to raise in establishing an AMC?

• Will there be one or multiple AMCs? (Govt. and/or
  Private)
• Will they be open to both private and public
  banks?
• Will they be limited to failed institutions?
• What methods of asset resolution will be
  permitted?
• Will they be limited to certain types of assets?
• What should be the transfer prices?
• How should the NPLs be paid for and when?
• Will AMCs enjoy special powers?

4
Typical impediments to the success of AMCs

• Lack of supportive laws
• Weak or inexperienced judiciary
• Lack of special powers
• Political interference

5
Factors affecting success of AMCs

• Political will
• Independence
• Legal regulatory framework
• Skilled staff
• Indemnification
• Ethics and rules of conduct
• Private contractors
• Reporting/accountability
• Information systems
• Market priced acquisition of assets
• Loss sharing / equity deals

• Clear goals
• Supporting operating polices
• Asset disposition
• Separation of assets
• Workouts
• Debt forgiveness
• Organizational structure
• Ownership structure
• Board of Directors
• Committees
• Sunset clause

6
Websites of select National AMCs

• China China Huarong Asset Management Company
• http//www.chamc.com.cn/English/index.asp
• Czech Republic Czech Revitalization Agency
• http//www.kobp.cz/ckaen.htm
• Indonesia Indonesian Bank Restructuring Agency
  (IBRA)
• http//www.bppn.go.id/default.asp
• Korea Korea Asset Management Corporation (KAMCO)
• http//www.kamco.or.kr/eng/index.htm
• Malaysia Pergurusan Danaharta Nasional Berhad
• http//www.danaharta.com.my/default.html
• Thailand Thai Asset Management Corporation
• http//www.tamc.or.th/