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The Piraeus Bank – Intrum NPL portfolio: an x-ray
Intrum is expected to deliver an overperformance that could reach up to 20% of the NPL reduction targets agreed with Piraeus Bank.
Having managed similar deals with some of Europe’s biggest banks (Intensa Sanpaolo, Santander), Intrum records an 11% average performance.
According to the bank’s basic scenario which predicts a 10% performance, the deal with Intrum will have a positive impact on the regulatory capital by 80-85 performance units in the first year. In the second year, it will reach 70 performance units and 50 in the third. By the end of 2021, it will reach a hundred performance units.
In total, the portfolio serviced by Intrum consists of €17,9 bn business loans, €6,2 bn mortgages and €2,8 bn consumer loans.
The revised plan of Piraeus Bank for the reduction of NPEs in the period December 2018 – December 2021 predicts a decrease from €26,4 to €11,3 bn.
The agreement estimates the value of the platform to €410 m. The price for the acquisition of 80% of the platform by Intrum amounts to 328 million euros.
The Bank has announced that it will proceed to the sale of 6.9 bn worth NPLs, six billion of which will be securitisations. As the management of the securitizations will be done by the servicer (Intrum), the Bank will not be charged with a removal fee.