ANALYSIS OF NON-PERFORMING LOANS, THE EVALUATION OF ITS IMPACT ON THE FINANCIAL STATEMENTS AND RATIOS OF BANK

As a result of their main function, banks transform the collected resources generally into loans. most of their revenue comes from loan operations but during these operations they are subject to many risks. they try to collect the loans on maturity, but due to asymmetric information and wrong decisions during crediting, financial crisis, reasons resulting from companies themself, sometimes problems may arise in collecting loans. problematic loans require special attention because of the negative effects on bank’s financial tables and ratios, operations, asset quality, capital adequacy and liquidity. but, in spite of all surveillance, internal and external controls and monitorings, istanbul approach, anatolian approach, asset management companies for clearance of non-performing loans, the amount of non-performing loans is increasing year by year. in the study, some main indicatiors, such as loans, non performing loans, balance sheet and income statement items, of turkish banking sector were examined by making ratio analysis for the period 2007-2013.