After the Louvre and Hermitage projects launched in 2020, the Catalan entity has launched the MoMA Project, with which it hopes to sell to opportunistic funds delinquent mortgages valued at 576 million, according to financial sources consulted by El Confidencial newspaper.

The second-largest Spanish group did not comment. These are doubtful mortgages (with more than 90 days of non-payment) that it had already tried to sell before covid-19 was extended, within another larger portfolio known as Tackle, according to the sources consulted.

Although they are pre-Bankia assets, this is the first operation that CaixaBank has put on the market since it absorbed the nationalised entity. The merger has increased the group’s non-performing loans from 8.7 billion to 14.1 billion and net real estate assets (discounting provisions) from 1.1 billion to 2.5 billion. In gross terms, this would be around 4.3 billion. Thus, the group chaired by Goirigolzarri has problematic assets valued at 18.4 billion on its balance sheet, which it needs to lighten before the default derived from the current pandemic crisis picks up.

Even so, the pressure from the European Central Bank (ECB) for all banks to get rid of toxic assets is at its maximum. CaixaBank has therefore decided to speed up this MoMA operation and could be preparing others to close before the end of the year.

This operation covers 5,700 credits from 3,700 creditors who initially requested 576 million, according to information distributed by KPMG to investors. The unpaid amount stands at 495 million. The portfolio is secured by 4,500 properties, which are mainly located in Madrid, Barcelona and Seville, and have a valuation according to the Big Four of 775 million, well above the value of the credits.

Singular Assets
The transaction includes some higher quality assets – properties worth more than one million euros – in locations such as Mallorca, Boadilla del Monte, Pozuelo de Alarcón, Costa Brava, Xàtiva and Barcelona. This operation represents a new litmus test for the sector, after a standstill in the sale of unpaid mortgages caused by operations carried out by Sabadell in 2020, according to the sources consulted. Thus, this entity lowered prices to a level that made it difficult for other banks to go on the market, due to the impact it could have on provisions.

Original Story: El Economista | J. Zuloaga
Photo: CaixaBank website
Translation & Edition: Prime Yield

The Spanish bank is negotiating two sales transactions to Cppib and Cerberus without a competitive process to clean up its properties in Spain.

The bank chaired by Ana Botín is negotiating two sales of troubled assets worth €1.5 billion with the Cppib and Cerberus funds, according to El Confidencial. The bank is negotiating both through a non-competitive process, without giving other investors the option to compete with the funds. These two processes are in addition to a portfolio that the bank already has on the market: the EUR 600 million Talos Project, for which it has received offers from Fortress, Marathon and Tilden Park. In total, Santander has begun the sale of assets worth more than EUR 2,000 million. Through these operations, the bank seeks to reduce its non-performing loans, which are among the highest in the country since the purchase of Popular. The operation underway with Cppib, a Canadian pension fund, covers the mortgages it ruled out buying until 2020, when it reached an agreement with Santander. The fund entered the Spanish market three years ago with the purchase of non-performing loans. On the part of Cerberus, the negotiation would cover unpaid credits worth 500 million euros. Santander has started selling assets worth more than 2,000 million euros.

According to a study by Prime Yield, the sale of bad loans by banks will soar in 2021 and could exceed 7,100 million euros, continuing with the strategy initiated last year by which between the second and third quarters they reduced the stock of NPLs (Non Performing Loans) by 2,400 million euros. Up to March, 700 million euros were transacted. Despite the banks’ efforts to get rid of the product, Spain continues to be the third country in the European Union with the most NPLs. Leading the way is France, with 125.4 billion NPLs, accounting for 2.3% of its total portfolio, and Italy, with 98 billion NPLs, 5.4% of its total stock.

Original Story: EjePrime.com
Photo: Website Grupo Santander
Translation: Prime Yield

Santander is preparing to sell €700 million worth of doubtful trade receivables, financial sources have confirmed to elEconomista. The divestment is, according to the same sources, at an initial stage and is being designed if it will be carried out as a block sale or divided into different portfolios, something that will be decided depending on the appetite of investors interested in these credits. In any case, the idea is to sell them during the course of this year.

With this operation, Santander recovers the pace of sales of non-performing loans, after a year in which the sector was at a standstill due to the pandemic. Santander’s real estate activities unit, integrated within Spain, has EUR 2,781 million in gross customer loans for real estate activity on its balance sheet, of which €924 million are classified as non-performing. Last year it only reduced €24 million of the total with portfolio sales, recoveries and subrogations by third parties, compared to the €1,685 million it reduced in 2019 or the €1,267 million in 2018.

Despite this slowdown in the drain on this type of assets, Santander closed the first quarter of the year with an NPL ratio of 3.20%, lower than in December, when it stood at 3.21%. At the level of Spain, the area with the highest NPL ratio of the whole group, it also continued to fall from December 2020 to March 2021, from 6.23% to 6.18%. This ratio could rise as the loan moratoriums granted expire. The group approved loan deferrals totalling 112 billion, of which 96 billion have expired, and of these, 5% have been classified as doubtful.

Original Story: El Economista | Araceli Muñoz and Eva Díaz
Photo: Santander Facebook
Translation: Prime Yield