The COVID-19 outbreak has effectively halted non-performing loan portfolio sales in Europe. With a total volume of loan sales of EUR 3.8bn, according to the new Debtwire European NPLs – 1Q20 report.
Before the market stopped, 13 deals managed to close with the only activity in Spain for EUR 1.8bn, in Italy for EUR 1.6bn and a single sale in Cyprus for EUR 400m.
On paper, portfolios containing EUR 75.4bn of loans are still on the market. Some have already been halted, though.
Buyers will have to reconsider the performance of their previous acquisitions having already observed large reductions in collections so far in Italy and Spain, the two European countries hardest hit by the coronavirus outbreak.
SME NPL securitisations in particular are seen as highly vulnerable to the pandemic.
European authorities and governments have launched a series of initiatives aiming to help consumers, SMEs and corporations hit by the COVID-19 pandemic, and some directly aimed at mitigating an anticipated rise in NPLs, which European banks had worked for years to reduce.
Debtwire's European NPLs Reports cover loan portfolio transactions across Europe including non-performing loan and non-core loan deals typically over EUR 100m in gross book value.
To find out more, download the full report below. For Debtwire subscribers, you can access more NPLs coverage, here.
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Alessia Pirolo is Head of NPL Coverage at Debtwire ABS. From a previous focus on Southern European Commercial Real Estate, she is now in charge to expand Debtwire's NPL coverage areas around the world. Before joining Debtwire, she covered U.S. and European commercial real estate for The Wall Street Journal, and the Commercial Observer. She holds a master’s degree from the Columbia University Graduate School of Journalism.
Amy is a data journalist for Debtwire. She covers the sale of NPLs and non-core loans, with a focus on Southern Europe NPLs as well as Irish/UK markets and unsecured loans.