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The major problem remained Zimbabwe's $1.4 billion debt to the IMF, the World Bank, and the African Development Bank, which the government could not repay; however, the policies of the new prime minister and his financial officials won considerable international support, which resulted in rescheduled loan repayments and offers of development assistance by foreign donors.
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New rules on accounting for rescheduled loans may mean an extra €10 billion in provisions.
The repayment rate of rescheduled loans, known as flexible loans, is currently over 98percentt.
One reason for the banks' rage was the failure of their plan to make their rescheduled loans senior to Marconi's bonds.
Many rescheduled loans are turning bad again within a matter of months of being taken off banks' books (see charts).
Fixing corporate balance sheets by rescheduling loan payments and converting debt to equity went a long way toward solving problems.
If a company is not generating significant profits and has no imminent prospects of doing so, creditors do not want to reschedule loan payments or swap debt for equity, Mr. Miller said.
For example, its member companies will refer people to free debt advice services, and will reschedule loan payments if customers cannot afford to pay them.
Yet securitisation has made it harder to reschedule loans and nobody knows how far house prices will fall.
These include allowing farmers to defer some of their payments, providing low-interest loans to help farmers improve their cash flow, combining loans at new rates and terms and rescheduling loans.
The banks, he said, should get much tougher, denying credit to nonviable companies so that they exit the market, while subjecting distressed companies to debt write-downs as opposed to rescheduling loans.
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