npl-reo Market News: Spanish Real Estate Intelligence

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
EU Banks Reduce NPL Ratio to 3%. Portugal Still at 10.5%
11 November 2019 – According to a report by the European Central Bank (ECB), EU-based financial institutions have reduced their total exposure to NPLs to 3% of outstanding loans. The banks have been steadily selling loan portfolios, writing off bad debts and slowly recuperating some of the loans. Banks in the EU had a total of €698 billion in NPLs at the end of June, equivalent to 3% of the total. That represents an fall of over €26 billion since the end of the previous quarter, when the ratio stood at 3.1%. While Portugal has also made progress with its NPLs, it is still one of the countries with the highest NPL ratios, currently at 10.5%, with 19.2 billion euros of debt in arrears as of June. Original Story: Jornal de Negócios - Rafaela Burd Relvas Adaptation/Translation: Richard D. K. Turner
Non-Performing Loan Exposure Falls by Half Since 2015
8 October 2019 – Portuguese banks are working to continue to reduce their exposure to non-performing loans to the levels demanded by banking regulators. Those same banks managed to their total of bad loans by approximately 2.5 billion euros during the first half of this year. According to the Bank of Portugal, the reduction led to a country-wide NPL ratio of 8.3% in June, down by 1.1 percentage points since December. Portugal’s banks still had €23.45 billion on their balance sheets as of June 30. After peaking at €50 billion (17.5% of the total stock of loans) at the end of 2015, the country’s banks have significantly reduced their exposure via portfolio sales and write-offs. European banking regulators, however, require the banks’ NPL ratio to fall even further, to 5%. Original Story: Economia Online - Alberto Teixeira Adaptation/Translation: Richard D. K. Turner