It will take years to go back to the pre-crisis levels, but in the meanwhile Italian banks are accelerating the disposal of non performing loans. Throughout 2016, the banks of the Peninsula have transferred npls for a value of 23.9 billion euro, according to what the Npl National Observatory launched by Credit Village has registered. This is the first independent observatory that has taken a census of all the operations actually executed on the market, with the aim to increase the transparency of the sector.
On the right track
The analysts have built a map of the transactions, registering a good 160 operations throughout last year. It has thus appeared that over the 10% of the approximately 200 billion non performing loans still within the banks has been disposed. Considering that 11.3 billion of the sold npls are related to re-trade operations that haven’t influenced the slimming of non performing loans within the system.
The Npls sold on the first market amount therefore to 12.6 billion euro.
The main sellers have been banks with 75% of the transactions. The 16% has come from the sector of financial companies for consumer credit and automotive, whereas the remaining 9% comes from the utility world and tlc.
More than half of the operations has been carried through the constitution of special purpose vehicles: the investor uses this vehicle for the securitisation of the purchases portfolio, according to the 130/99 Law.
Atlante in the game again
The operations have continued also in the last months. In chronological order the last operation dates back to few days ago when Quaestio Capital Management Sgr concluded a securitisation operation on behalf of Fondo Atlante II, which considers the purchase of about 2.2 billion non performing loans, about two-thirds of the portfolio of Nuova Banca Marche, Nuova Banca dell’Etruria and Nuova Cassa di Risparmio di Chieti, the entities created in 2015 after the “bail in” by the National Fund of Resolution.
The operation makes possible the transfer of the three banks to Ubi Banca and allows solving permanently one of the most critical situations in the Italian banking system.
This is the first operation of Atlante II, the fund created in 2016 for the exclusive purchase of non performing loans from the Italian banks and managed by Quaestio.
The selection of three special servicers is currently in progress, they will be chosen among primary operators of the credit collection sector. The partition and assignment of the roles are decided by Quaestio through competitive procedures in order to protect the interests of its investors and to contribute to creating in Italy an efficient and open to competition npl market.
What is left to do
Meanwhile, the meetings between institutions and market operators go on, with the aim of finding new solutions capable of accelerating the disposal of the npls. In the past few days, the Abi technical board has gathered in Milan, with the participation also of Rics and 11 other associations from the real estate industry. In this occasion an agreement has been met on the procedure for two real estate diligences, the activity is mainly finalized at finding the possible risks of the transactions in order to favour the transparency towards the potential stakeholders.
The board has also the goal to clarify the necessary requirements for the real estate evaluator role, as well as the definition of the evaluation activity on the real estate set as a guarantee to the non performing loans, through the adoption of standards developed at national and international level.
The Abi guidelines acknowledge the Bce recommendations contained in “Guidelines for the banks on the non performing loans” published last 20th March which express clearly the necessity to adopt high standards of evaluation such as those promoted by Rics in its Red Book.
The choice of professionalism
The quality of the evaluations is fundamental in the effort to eliminate the toxins accumulated in the years of the crisis.
According to the study carried by Inarcheck, more than 90% of the investigations is not correct. If we consider that every year the real estate assessments for the disbursement of the loans exceed 250 thousand, we can have an idea of the impact of these errors have on the financial statements of the banks. In this perspective, it is not surprising that over 40% of the non performing loans is connected to real estate.
The positive aspect is that the situation is improving, but there is still, however, an obstacle to overcome: the lengthiness of the credit collection times, at these days on an average of 1,120 days ( with deep differences among the regions of the Country, with the South setting on considerably higher levels), more than double the 553 days of the Ocse average.