Banks Want to Transfer One Billion Euros to NPL Platform

23 March 2018

Portugal’s banks had already expected to see results from the restructuring of bad debts by the end of the first quarter, but the NPL platform is only just starting to manage the defaulted loans.

The Caixa Geral de Depósitos (CGD), BCP and Novo Banco, the three banks that signed the memorandum to join the NPL management platform, have already compiled a list of the outstanding debts that they wish to transfer to the facility. The total amount of defaulted loans that they will jointly manage totals one billion euros.

The news was initially reported on Friday by the Jornal Econômico, which cited a source linked to the process. According to the same newspaper, the one billion euros are “almost evenly” distributed among the three banks that joined the platform.

The list comes about a month after the three banks began contacting their customers to inform them that their defaulted loans would be jointly managed by the NPL management platform. The Jornal de Negócios also reported that the banks’ employees are in charge of the process. The platform itself cannot directly contact the debtors due to banking secrecy laws.

At that time, the platform was already in operation, in facilities that were ceded for the purpose by CGD.

The memorandum of adhesion to the Bank Credit Management Platform was signed by CGD, BCP and Novo Banco last September. The facility aims to resolve the three banks’ outstanding non-performing loans and shrink the average restructuring time for the debts by a third, to six months.

The platform was, however, delayed. In September, the banks hoped that by the end of the first quarter of this year, which ends next week, results would already be beginning to be seen. However, as the list of the debts that will be managed by the platform has only just been completed, the restructuring process is just beginning.

Original Story: Economia Online

Translation: Richard Turner