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.
Lack of sales of legacy NPLs and the distressed caused by the COVID-19 crisis have contributed to increase European banks’ NPLs for the first time in years.
The total volume of NPLs in the EU/EEA countries was EUR 526.3bn at the end of the second quarter, up from a record low of EUR 522.8bn at the end of March, according to the European Banking Authority's (EBA) quarterly Risk Dashboard.
NPL sales seen so far in 2020 has been extremely concentrated, with EUR 25.1bn or 64% of the total closed deals so far in Italy. Adding EUR 9.1bn closed in Greece, the two countries together accounting for 87.2% of the total European activity so far.
Italian-state-owned AMC AMCO was involved in EUR 11bn or 28% of the total sales. EUR 10bn or 25.5% were securitisation with state guarantees within the Greek Hercules Asset Protection Scheme (HAPS), and Italian GACS schemes — EUR 7.5bn and EUR 2.5bn respectively — according to the Debtwire NPL Database.
Among EUR 70.9bn currently live deals tracked by the database, EUR 31.7bn or 44.7% plan to use the schemes — EUR 23.6bn in Greece and EUR 8.1bn in Italy.
To view NPL's presentation of Debtwire week 'The new rise of NPLs' panel, please click here.
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 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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