Demand on capital market
in billions guilders
guilders in 1980, and the number of applications accepted was 1,954
(compared to 2,789 in 1980).
Naturally there were problems with some of our borrowers during fiscal
1981There were many cases of marriage and relationship problems, as
well as excessive debt over and above the mortgage. In the corporate
sector, liquidations occurred mainly in cases where smaller firms could
no longer meet their costs of operation, or where small property entre
preneurs predicted sales which failed to materialize.
Our risk management is aimed at reaching an acceptable solution with
the borrower. If this fails and there is no prospect of an improvement,
we resort to a foreclosure sale. Here we may buy the property at auction
if, after taking into account the market situation the auctioning off to
others will not provide a reasonable recovery.
Of course we pay particular attention to the sale of property which has
been purchased and which cannot be putto our own use. In this way it is
possible to sell most properties on an orderly basis within a few months
and at better prices than would have been possible at auction. In 1981
301 auctions were held, and at the end of the year 141 of these
properties were held for re-sale. As envisioned by the new mortgage
laws we would like to seethe introduction of the right to acquire
property by deed in lieu of foreclosure as a relief measure.
An important element in good risk management is preventing problems
from becoming acute. Good cooperation on the part of both lender and
borrower can often prevent uncurable difficulties from occurring.
Looking at our whole portfolio and taking into account our financial
manoeuvring capacity, we feel certain that problems confronting us can
be resolved. We consider ourselves fortunate in having our broad real
Public placements
bonds and mortgage
bank bonds
Government
Mortgage bank bonds
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