Governments and regulators need to be investors' “best friend” as they face a new wave of non-performing loans, said panellists involved in NPLs in Europe, China, and globally on a webinar,The New Rise of NPLs - Strategies and Investment Opportunities in the Market, aired live yesterday (14 October) duringDebtwire Week.
The COVID-19 crisis has hit the European NPL market. The first three quarters of 2020 have been the least active since 2015, with only EUR 39.2bn of deals completed across Europe, according to the new Debtwire European NPLs 3Q20 report presented at Debtwire Week.
Securitisations of non-performing loans using state guarantee schemes in Italy and Greece have been the main tool European banks have used to dispose of NPLs so far this year, a Debtwire anaylsis shows.
European banks have been preparing for a new wave of bad loans due the COVID-19 crisis. In the first quarter of 2020, Europe's largest banks set aside more than EUR 21.5bn of provisions to cover losses from bad loans, up 207% from EUR 7bn in the same period in 2019, as they brace for a financial fallout due to the virus.