Pancreta Bank’s tender for the servicing of its business and home NPEs of €1.077 bn will soon be completed. Mount Street Mortgage Servicing is acting as a consultant in this tender.
On September 11, Pancreta received three binding offers from doValue Greece, Qquant Master Servicer and Cepal and is called upon to decide which one will service the NPEs and buy the intermediate rating titles of the “Castor” securitization.
The servicer who wins the bid will purchase up to 95% of the intermediate and low-grade securities of NPEs, with a gross book value of approximately €297 m (project Castor). Pancreta has transferred these securities to a SPV, before issuing three classes of securities: senior notes, amounting to approximately €145 m, mezzanine notes, amounting to approximately €58 m and junior notes of €94 m.
The bank is going to keep all the first class bonds as well as 5% of the intermediate and low grade securities. The remaining 95% will be sold to the preferred investor.
The portfolio includes mainly corporate loans of about 1,000 borrowers (mostly very small and small companies from Crete), which have mortgages on hotels, land and industrial buildings. About 50% of loans are terminated. The value of the collateral amounts to approximately €300 m and the total receivable of the bank to €351 m.
The investors also bid to take over the servicing of all mortgage NPEs, which will remain in the book of Pancreta. These are loans with a total demand of €783 m of about 5,000 borrowers; most of them are self-employed and small businesses. The value of the collateral is estimated at around €600 m. Αbout 30% of the loans are terminated.
This is the first portfolio of the domestic market that has collateral in one geographical area (Crete). It has, according to the teaser, a high percentage of first collateral (about 70% of loans), low dispersion (the 40 largest loans represent about 50% of the total demand), while the collateral of the 120 largest borrowers represents about 50% of the total value of the portfolio collateral.
The loss from the sale of mezzanine and junior notes of the securitization is expected to be covered by the upfront fee, which will be given by the preferred investor to take over the serbicing of the mortgage NPEs.
Original Source: Euro2day
Adaptation/Summary: Kiki Athanasiadis