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npl-reo Market News: Spanish Real Estate Intelligence

NPLs in Italy: transactions record for 70 billion in 2018
07 December, Il Sole 24 Ore It has been a record year for Italian NPLs. Operations will reach 70 billion euro in 2018, as PwC explained in its report “NPL: Entering a New Era”. Banks have disposed of significant volumes of bad loans throughout the year. In June 2018, the NPLs were 222 billion in comparison with the 264 billion registered in December 2017. Meanwhile, the collaterals for bad loans have considerably increased, set at 65.9%. The surveillance authorities and the market will further push the banking system towards more disposals and more standardised credit management processes. NPL operations will continue in 2019 when they’re estimated to reach at least 50 billion. Besides, the first multi-originator NPL transfers have just started (approximately 1.6 billion), opening the market to banks with smaller NPL portfolios which would have no chance to be considered by investors if taken separately. The NPL secondary market has seen an increasing number of transactions due to the exit strategies of early investors as well as to the interest of new players for the Italian NPL market. Concerning UTPs, the market has seen only a limited number of operations so far. As UTP have now surpassed bad loans, amounting to 56 billion in June 2018 against the 43 billion of NPLs, an additional leverage will be essential in 2019, also through structured solutions. Among these, there are securitisation, even with Gacs, if these will also be extended to UTPs in March 2019. Other solutions are the transfer of UTPs of banks and liquidity of third-party investors to funds, and UTP servicing based on restructuring the holdings, their turnaround and the issuance of new funding. The servicing market is still consolidating, if we look at the operations by Intrum-Intesa Sanpaolo and the Banco Bpm. The consolidation phase already started in 2017 with the acquisition by Intrum of 51% of the Intesa Sanpaolo platform along with the NPLs for 10.8 billion, and the trend might continue in 2019 with other M&A operations. According to Pier Paolo Masenza, Financial Services Leader at PwC: “The market is currently extremely challenging for the Italian banks. The financial markets are looking closely at Italy. The proof is the indirect relationship between the market capitalisation (on TBV) and the impact of the NPEs on the listed banks rather than the modest increase of the returns of the 10 years Government bonds or the increase of the cost of CDS related to Italian issuers. The pressure of the market will push Italian banks towards more deleverage activities on NPLs and the optimisation of their internal processes concerning credit management”. Source: Il Sole 24 Ore Translator: Cristina Ambrosi
Fonspa and Elliott acquired NPLs for 8 billion from Banco Bpm
10 December, Il Sole 24 Ore The team composed of Credito Fondiario (Fonspa) and Elliott adjudicated the non-performing loan portfolio for 8 billion euro put for sale by Banco Bpm along with the management platform. Therefore, the Ace project has concluded. The Board of Directors headed by Giuseppe Castagna named the winners who will obtain the exclusive right to close the auction. Fonspa and Elliott — assisted by Goldman Sachs and PwC — had met the price expectations of Banco Bpm, relaunching by 24-25% the nominal value. The offer concerns the NPL portfolio, valued 7.8 billion, and another portfolio of credits backed by leasing contracts for 800 million as well as 51% of the management platform. Source: Il Sole 24 Ore Translator: Cristina Ambrosi  
San Marino: Cerberus bought Delta’s NPLs
11 December, Linkedin The last step has been completed to solve the legacy of Delta, the consumer credit company from Bologna filed for bankruptcy in 2009. The project Arcade positively concluded on 5th December with the securitisation of credits for a nominal value of 2.1 billion. The buyer is the fund Cerberus which has been operating on the Italian NPL market for a long time. The operation is included in the reorganisation agreement (former 182bis of the bankruptcy law) concerning the Delta group, a subsidiary of Cassa di Risparmio della Repubblica di San Marino. The operation involves over 80 Italian and foreign banks among the creditors. According to the agreement, the Delta credit management company Sgcd (a special purpose vehicle participated by leading Italian banks such as Unicredit, Mps, Bper Banca, Banco Bpm, Bnl, Bpvi and, indeed, Cassa di Risparmio di San Marino) is in charge of the management and collection of the credits towards customers (personal loans, salary deducted loans, leasing and healthcare credits) as well as the distribution of the proceeds to the creditors. For the company founded by Mario Fantini, whose 21% is owned by Cassa di Risparmio di San Marino and 34% by Sopaf of the Magnoni family, the difficulties started in 2009 when it was put under compulsory administration due to some governance issues and serious managerial irregularities. Intesa Sanpaolo came to help Delta at the end of 2010 by taking over the subsidiaries Bentos Assicurazioni and Sedicibanca, while other companies such as Carifin Italia, Plusvalore and Detto Factor were liquidated. Sgcd will have to deal with the liquidation procedure, trying to collect as much as possible on behalf of the banks. This is the objective of the Arkade operation, which has already got the non-binding offers from some specialised investors. The operation is coordinated Sgcd president Domenico Trombone, and it was assisted by the financial consultant Erberto Viazzo from EY and the legal consultants Simone Rossi and Claudia Bruscaglioni from Macchi di Cellere Gangemi. For Cassa di Risparmio di San Marino, it might be good news, considering its recent financial issues. Source: Linkedin Translator: Cristina Ambrosi