The hard adjustment process being experienced by Spanish banks is causing a dramatic increase of the number of assets on sale. Apart from portfolios of affiliated companies, the international funds are also looking at opportunities in consumer credits and in real estate management platforms.
Among these names, there are some of the most specialized management companies in the world, such as Apollo, Cerberus, Lone Star or the hedge fund D.E. Shaw. Also Fortress, Centerbridge, WL Ross, from the millionaire Wilbur Ross, Aktiv Capital, Lindorff, Oaktree or TPG. Why now? Because the market is more mature and operations are being closed at more reasonable prices, even in levels between 1% or 2% of the nominal value of the portfolio of troubled loans, for example.
The sale of credit portfolios will increase in the next few months. Iheb Nafaa, general director of Gescobro assures that forecasts show an increase of 50% of this type of operations during 2013. In total, the sector expects sales of portfolios for 15.000 million Euros this year.
According to Nafaa, many of the operations to be closed in the next few months will be transfers of recovery platforms, including credit portfolios and staff. Santander, Popular, Banesto and Bankia have already followed this path. Popular, for example, sold recently its recovery business to EOS for 135 million Euros. “The institutions have the possibility of obtaining capital with these operations, as the consumer portfolios need a lot of capital”, he adds.
BMN has put a portfolio of troubled loans on sale for around 1000 million Euros. “We think there is a great demand in this market and we want to take advantage of it, as other banks have already done”, sources close to the institution declare. Liberbank, for example, sold in February a portfolio of 574 million Euros in default assets from individuals and medium and small sized companies, which includes contracts from its subsidiary BANCO CCM, to Cerberus Capital Management.
These transactions have boosted in the last years. In 2009 and 2010, there were hardly any sales of portfolios. Two years ago, the market started moving and credits were sold for 8000 million Euros. This figure increased to 10000 to 12000 million Euros in 2012. “There are 20 or 30 great funds looking at opportunities in Spain”, Nafaa explains.
On the other hand, they are looking at opportunities in the real estate sector. “We will see many sales of joint portfolios of consumer and real estate credits”, Nafaa adds. In fact, the executives at Sareb are having meetings with foreign funds and could close a great wholesale sale in the short term. According to its new business plan, it is planning to sell credit portfolios for 12.000 million Euros in its first years in operation, hoping to gain 2000 million Euros.
But the nationalized banks have already put their real estate asset management platforms on sale. Bankia wishes to get rid of Bankia Habitat with its 500 employees. NCG Banco is also negotiating the sale of its subsidiary and the outsourcing of the service along with the staff, around 900 workers. The subsidiary, called Singular Assets Management Unit, is made of real estate assets and loans to companies and small and medium sized companies that have ceased payments, and to individuals, Abeta Chas informs.
Those funds which acquire these businesses could aspire to manage the assets from Sareb, a task which is now carried out by the institutions. Hence the interest shown by investors. (…)