Page 117 - BKT Annual Report 2023 EN

ANNUAL REPORT 2023 48
Notes to the Consolidated Financial Statements for the year ended 31 December 2023
(amounts in USD, unless otherwise stated)

Loans with renegotiated terms
Loans with renegotiated terms are loans that have been restructured due to deterioration in the borrower’s financial position and where
the Bank has made concessions that it would not otherwise consider.
Once the loan is restructured, its performance is closely monitored for the purpose of impairment testing.
Set out below are the carrying amounts of loans to customers whose term have been renegotiated and are under monitoring:
FORBORNE LOANS TO CUSTOMERS ACCORDING TO THEIR CREDIT QUALITY AT AMORTISED COST
Total amount of
31 December 2023 Total amount of Loans Forborne Loans Forborne Loans (%)
(Permanent modification)
Stage 1 1,565,660,683 2,302,413 0.1%
Stage 2 131,872,458 72,469,274 55.0%
Stage 3 51,073,594 10,404,405 20.4%
Exposure before impairment 1,748,606,735 85,176,092 4.9%

Stage 1 Allowance 17,900,687 13,170 0.1%
Stage 2 Allowance 17,657,724 11,959,319 67.7%
Stage 3 Allowance 18,912,613 3,084,572 16.3%
Total net amount 1,694,135,711 70,119,031 4.1%

Discounted value of collateral 2,833,140,573 92,674,443 3.3%

Off Balance Sheet Allowance 106,727 - -

FORBORNE LOANS TO CUSTOMERS ACCORDING TO THEIR CREDIT QUALITY AT AMORTISED COST
Total amount of
31 December 2022 Total amount of Loans Forborne Loans Forborne Loans (%)
(Permanent modification)
Stage 1 1,245,049,751 10,719,083 0.9%
Stage 2 141,822,262 75,015,566 52.9%
Stage 3 54,422,077 11,493,576 21.1%
Exposure before impairment 1,441,294,090 97,228,225 6.7%

Stage 1 Allowance 21,014,746 232,357 1.1%
Stage 2 Allowance 18,006,235 13,606,329 75.6%
Stage 3 Allowance 18,471,388 3,135,690 17.0%
Total net amount 1,383,801,721 80,253,849 5.8%
Discounted value of collateral 2,295,117,030 116,268,877 5.1%

Off Balance Sheet Allowance 119,772 - -

iv. Collateral and other credit enhancements
The Group employs a range of policies and practices to mitigate credit risk. The most common of these is accepting collateral for funds
advanced. The Group has internal policies on the acceptability of specific classes of collateral or credit risk mitigation.
The Group prepares a valuation of the collateral obtained as part of the loan origination process. This assessment is reviewed periodically.

The Group prepares a valuation of the collateral obtained as part of the loan origination process. This assessment is reviewed
periodically. The principal collateral types for loans and advances are:
- Mortgages over residential properties;
- Financial Assets
- Charges over business assets such as premises, machineries, and accounts receivable;

Longer-term finance and lending to corporate entities are generally secured; revolving individual credit facilities are generally unsecured.