npl-reo Market News: Spanish Real Estate Intelligence

Novo Banco’s NPL Ratio Falls Below 15% After Sale of Nata II
20 November 2019 - Novo Banco, for the first time since its inception, has managed to reduce its NPL ratio below 15%. The reduction follows the sale of its Nata II loan portfolio. The bank announced last week that Portugal’s Resolution Fund had authorised the bank to sell the loan portfolio, resulting in its decreased exposure. The bankadded that the Resolution Fund had used its prerogative to exclude some of the loans from the portfolio. Novo Banco noted that it had already removed ten debtor groups from the loan portfolio after encountering more advantageous solutions. Original Story: Observador - Manuel de Almeida Adaptation/Translation: Richard D. K. Turner
Deloitte to Audit Novo Banco As Losses Mount
14 November 2019 – Novo Banco’s request announcement that it would request another capital injection from the Resolution Fund has strengthened calls from Portugal’s parliament for a major audit of the financial institution. The bank has yet to announce the size of the needed injection from the contingent capital facility. However, the bank’s results from the first three quarters of the year point to a figure of around €850 million. A injection of that size would extend the total needed transfers to Novo Banco to €3 billion.   The Government, after pressure from the Parliament, has commissioned Deloitte to conduct an independent audit to assess the bank’s actions in regards to the assets it inherited from BES. The scope of the special audit will cover credit operations, including the granting and guaranteeing of loans, debt restructuring and write-offs, the execution of guarantees, sale of credit portfolios and transfers to restructuring funds. The audit will also cover investment, expansion and divestment decisions made in Portugal and abroad; including decisions covering asset acquisitions and disposals. So far, the Resolution Fund injected €1.149 billion this year (to cover losses of €1.423 billion in 2018), in addition to €792 million last year (to cover losses in 2017), totalling 1.941 billion euros. Last Friday, the bank's results continued to worsen, with losses in the first nine months of the year increasing from €390.9 million to €572.3 million. According to a statement by the bank, Novo Banco posted losses in the first nine months of the year relating to the “restructuring process and deleveraging of non-productive assets, namely the Sertorius project, the Albatross project, the NATA II project and the sale of GNB Vida.” Original Story: Público - Pedro Ferreira Esteves Photo: Rui Gaudêncio Adaptation/Translation: Richard D. K. Turner
Novo Banco to Request €700 Million from Resolution Fund
11 November 2019 – Novo Banco will reportedly ask Portugal’s Resolution Fund for a new capital injection of more than 700 million euros in 2019. Losses for the first three quarters of the year have already exceeded €640 million. The Resolution Fund will complete the capital injection within the contingent capital mechanism that was agreed upon during negotiations of the sale of 75% of Novo Banco to the US-fund Lone Star. The fund is required to inject funds into Novo Banco whenever there are losses on the sale of a specific set of assets that negatively impact the bank's accounts. Original Story: Jornal Expresso - José Carlos Carvalho Adaptation/Translation: Richard D. K. Turner