Project Orion: CaixaBank Launches the Sale of Another €600M in Doubtful Loans

23 July 2018 – Voz Pópuli

CaixaBank’s divestment machine is not shutting down, even for a second. The entity led by Gonzalo Gortázar has just closed the largest real estate sale in its history, a €12.8 billion portfolio, which it has sold to the fund Lone Star, and it has already launched another new operation.

The latest deal is Project Orion, through which CaixaBank wants to transfer a €600 million portfolio of problem loans to opportunistic funds, according to financial sources consulted by Vozpópuli. Unlike on other occasions, the portfolio does not comprise loans to property developers but rather credits to small- and medium-sized entities (SMEs). The loans are secured by real estate collateral, be it property purchased by the delinquent SMEs or other property offered as collateral when asking for a loan for business activity.

Project Orion was launched a few weeks ago and is expected to be closed after the summer. Currently, interested parties are immersed in the non-binding offer phase.

From flats to loans

The former Caixa is placing this portfolio on the market to reduce its volume of doubtful assets, having eliminated its foreclosed assets from its balance sheet. The entity agreed with Lone Star the sale of €12.8 billion in flats, land and developments for €6.7 billion.

On Friday, CaixaBank presents its results for the first half of the year, which will show the first snapshot of the entity following the agreement with Lone Star.

In addition to that agreement, the entity sold a portfolio of €650 million in problem loans to Cerberus, as part of Project Ágora.

Following those operations, CaixaBank is left with €3 billion in rental homes and €13 billion in doubtful loans on its balance sheet, in net terms.

The market expects the entity to make another major divestment of doubtful loans over the coming months, by selling an even larger portfolio than Project Orion. With that, the Catalan entity would be in a strong position to launch its new strategic plan, which it will announce at the end of the year.

Original story: Voz Pópuli (by Jorge Zuloaga)

Translation: Carmel Drake

Ibercaja Sells €210M NPL Portfolio To Seer Capital

6 July 2015 – Expansión

On Friday, Ibercaja closed the sale of a portfolio of non-performing loans, worth €210 million, to the US fund Seer Capital. The operation generated gross profits of almost €10 million for the Aragonese entity.

The portfolio contained doubtful unsecured loans, which were all fully provisioned, as well as non-performing loans.

Like other institutions, Ibercaja has accelerated the sale of problematic loans in recent years to devote its resources to productive assets and obtain profits on loans that it has already written off.

Ibercaja sold a similar portfolio in 2013, worth €540 million, to the US fund Yorvik and Savier Asset Management, owned by Javier Botín.

This is the first transaction that Seer Capital has undertaken in Spain. The fund was created in 2008 by Philip Weingord, former director of Deutsche Bank. The US firm manages assets worth €1,806 million, including mortgages, syndicated loans, SME loans and consumer finance with some kind of default (non-payment).

Other divestments

Moreover, Ibercaja Banco has refocused its strategy in recent months to take on a more active role in the market. Thus, the entity has engaged KPMG as an external advisor to perform the preparatory work towards an IPO in the coming years. The entity has until the end of 2018 to list on the stock exchange and so it has recently begun to explore that option in more detail.

In addition, a few weeks ago, the entity began a process to transfer the majority of the properties on its balance sheet. In total, the Aragonese group has put €800 million of foreclosed assets up for sale, including 6,900 residential units; 1,300 commercial premises and industrial buildings; and 600 plots of land. The transaction, known as Project Kite, is being advised by N+1.

Original story: Expansión (by J. Z.)

Translation: Carmel Drake