The aim of this paper is to identify the factors that led to the rise in nonperforming loans in Serbia with a certain time distance. The paper focuses on measures and activities undertaken by the National Bank of Serbia (NBS) before and after the adoption of the NPL Resolution Strategy (hereinafter: Strategy), and the results of their implementation. Numerous analyses indicate that the level and structure of nonperforming loans (hereinafter: NPLs) are determined by a combination of macroeconomic and bank-specific factors. The movement of NPLs in Serbia and the surrounding countries in the pre-crisis period was, to a large extent, the consequence of less conservative credit risk assessment models in an environment of robust credit expansion. An additional factor was inadequate collateral valuation. During the crisis, we were faced with a situation where the credit risk, taken in the previous period, materialised. NPLs grew in parallel with the deterioration of macroeconomic conditions. After several attempts to resolve this complex issue by using individual measures, it was confirmed in practice that a permanent resolution of NPLs requires a systemic approach and active involvement of all relevant institutions. Taking into account the factors behind the high level of NPLs, it was clear that a necessary and important component of success was the stabilisation of macroeconomic environment. As price stability and relative stability of the exchange rate were ensured in Serbia and macroeconomic outlook improved, conditions were created conducive to the accelerated resolution of NPLs through numerous measures and activities, which particularly intensified after the adoption of the Strategy (August 2015). In the environment described above, the NPL stock halved since the Strategy adoption (down by 54%), reducing the share of NPLs in total loans by 12.9 pp to 9.5% (preliminary December 2017 data, final data could be slightly different), thus falling below the pre-crisis level.