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Debtwire NPL Chart of the Week: Greek banks focus increasingly on NPL securitisations

NPL Chart of the Week: 11 June 2019

Last year, the main trend was Italian banks' sales of NPL management platforms and disposals of loans via securitisation. In 2019, the same storyline is increasingly emerging in Greece.

After months of planning, Greek banks are moving ahead with much awaited NPL transactions. Earlier this week, Piraeus Bank and Intrum announced a partnership that will give the Swedish company an 80% stake in the NPL management platform of the bank.

During the months of negotiations, market sources had rumoured the deal to include an NPL portfolio sale ranging from EUR 2bn to EUR 10bn. In the end, the agreement was just on the platform, involving the management ofabout EUR 27bn of NPLs and EUR 1bn of REOs on an initial term of 10 years.

Piraeus CEO Christos Megalou confirmed the bank's plan to reduce NPEs by EUR15bn by 2021 in a call discussing the deal and bank’s 1Q19 earning reports. Theonly imminent sales are a EUR 700m unsecured portfolio and a EUR 500m shipping portfolio, the bank stated. For the future, Megalous added that the new independent servicer will be “ideal platform for managing securitisation assets” and will manage the “securitised portfolio that will come out of our NPE reduction plan”.

Securitisations are increasingly becoming part of the NPL disposal strategy of Greek banks. Last week, Eurobank Ergasias’s EUR 2bn Project Pillar became the first rated Greek NPL securitisation when DBRS provisionally rated the EUR 1.044bn class A notes of Pillar Finance BB (low). The sale of the notes, together with another EUR7.5bn securitisation, Project Cairo, and the bank’s non-performing loan management platform, FPS, has been narrowed down to three groups of bidders — Bain Capital Credit with Elliott, Fortress Investment Group with doBank, and PIMCO,due to present offers by July.

The next securitisation to hit the Greek market will be Alpha Bank’s EUR 2bn Project Orion, consisting of a portfolio of mainly mortgage loans. The bank is also working on the sale of aEUR 1.8bn NPL portfolio secured by real estate owned by SMEs.

National Bank of Greece also has plans for securitisations with a total value of EUR 3bn by 2022, CEO Paul Mylona recently said. At the moment, NBG is also close to finalising the sale of a EUR 1bn secured portfolio for which it is in exclusivity with Centerbridge and Elliott. In the meantime, it has received offers for a EUR1.2bn unsecured portfolio of credit cards, consumer loans and SME loans, the EUR 1.2bn Project Mirror, and will launch a EUR 700m secured corporate portfolio in 2H19.

Alessia Pirolo Head of NPL Coverage Debtwire

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.

Alessia Pirolo Head of NPL Coverage Debtwire

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.

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