NPL&REO News

Consumer credit fell slightly in April, dropping to €714.9 million.

30 June, 2025

According to data from the Bank of Portugal, consumer credit fell by 8% to €714.9 million in April. Nevertheless, this figure for new loans represents a 1% increase compared to the same month last year.

The Bank of Portugal’s data reveals that consumer credit fell by 8% in April. Nevertheless, this figure for new loans represents a 1% increase compared to the same month last year.

The number of contracts fell by 8.6% to 135,043, representing an annual decline of 4.8%.

In terms of the number of new loans, the biggest drop was in credit card and overdraft agreements (-12% in one month), amounting to 71,822 agreements. This was followed by personal loan agreements, which fell by 5.1% in April to 45,059 agreements.

Finally, car loan contracts fell by 2.1% in April, amounting to 18,162.

In monetary terms, the largest decline continues to be in the ‘credit cards and overdrafts’ category, with new loans falling by 12.2% to 112 million euros.

Personal credit fell by 9.4%, with new credit standing at €320 million. Finally, new car credit fell by 4.6% in April, with the amount of new credit in this category reaching €238 million. Of particular note is the 32.7% drop in financial leasing, also known as ALD, for new cars.

Original Story: Jornal Económico | Author: Maria Teixeira Alves
Edition and translation: Prime Yield

The non-banking sector now accounts for 34% of financial assets under management in Spain

27 June, 2025

The combination of interest rates being stuck at zero per cent for years and a credit crunch at some point in the cycle created the ideal conditions for financing and investment outside the banking sector to flourish. In fact, the expansion of the non-banking financial sector has far outpaced the growth of the banking business over the last decade in both Spain and Europe. This has not gone unnoticed by regulators, as the phenomenon poses clear challenges to financial stability.

In Spain, this activity already accounts for 33.8% of the financial system’s total assets, although this figure remains far below the 59.9% represented by the non-banking financial sector in the euro area. According to data from the Bank of Spain, at the end of 2024 the total unconsolidated assets of banks and the non-banking financial sector in the domestic market amounted to €3.09 trillion and €1.58 trillion respectively.

In the euro area as a whole, these figures were €38.56 trillion and €57.49 trillion for the banking and non-banking sectors, respectively. However, what is particularly significant about this phenomenon is the pace at which it is advancing. While total assets managed by banks in Spain grew by almost 10% between 2015 and 2024, those channelled through the non-banking sector increased by around 25% — more than double.

According to the latest Financial Stability Report published by the Bank of Spain, the increase was 30% and 40% respectively over the last decade in the eurozone.

The term ‘non-banking’ encompasses ‘shadow banking’, which is not subject to the strict requirements imposed on financial institutions, as well as a long list of regulated and supervised operators, including insurance companies, pension funds, money market and non-money market funds, credit institutions, securitisation funds, and securities companies and agencies. This also covers the activities of venture capital companies, SOCIMIs, payment institutions, appraisers, and instrumental subsidiaries that issue securities.

In its latest annual report for 2024, the ECB acknowledges that the non-banking sector (IFNB) maintained its resilience to market volatility and supported market financing across all credit risk categories in the euro area. However, the report also notes that ‘vulnerabilities related to exposure concentration, liquidity mismatches, and high leverage in certain areas of the investment fund sector continue to be a cause for concern’.

Among the risks it monitors are sharp changes in valuations, which could lead to sudden fund outflows and margin calls, amplifying adverse market dynamics and causing spillover effects to other parts of the financial system.

According to the Financial Times, EU regulators are planning the first stress test to identify vulnerabilities in the non-bank financial system in the event of a worsening market crisis. This would include private equity firms, hedge funds, money market funds, insurers and pension funds, following a similar exercise carried out by the Bank of England last year.

The aim is to examine how a crisis would spread among the different parts of the financial system, and whether it could magnify the impact rather than absorb it.

Original Story: El Economista | Author: Eva Contreras
Edition and translation: Prime Yield

BPI completes the sale of a €82 million NPL portfolio

24 June, 2025

The portfolio, which includes secured and unsecured positions involving around 22,900 loan agreements and approximately 5,600 customers, was sold to funds managed by a US-based asset manager.

Through a competitive process, BPI has completed the sale of a non-performing loan portfolio with a total gross value of around €82 million.

It was sold to funds managed by a US-based asset manager and includes both secured and unsecured positions, involving around 22,900 loan agreements and approximately 5,600 customers.

“This transaction reinforces BPI’s solid position, which maintains a low-risk profile,” the bank said in a statement.

Original Story: Jornal Económico | Author: Maria Teixeira Alves
Edition and translation: Prime Yield

Banks reduced loans but expanded total disbursements in 2024

24 June, 2025

Greece’s banks reduced loans to businesses but increased overall disbursements in 2024 compared to 2023. Large businesses received the largest amounts, and also borrowed at the lowest interest rates compared to the rest.

According to data from the AnaCredit statistical database, the value of new business credit agreements amounted to 28 billion euros in 2024, slightly reduced compared to 2023.

However, the debts of non-financial corporations (NFCs) to domestic credit institutions corresponding to these agreements – that is, the value of loans not only agreed upon but also disbursed during this year – increased significantly by 61%, reaching €20.6 billion, up from €12.8 billion the previous year.

Original Story: Ekathimerini
Edition: Prime Yield|
Image by Raten-Kauf from Pixabay

Groupe BPCE to acquire 75% stake in Portugal’s novobanco for €6.4bn

16 June, 2025

The deal forms part of BPCE’s VISION 2030 strategic plan, designed to expand its operations in France, Europe, and beyond.

French lender Groupe BPCE has agreed to acquire a 75% stake in novobanco, a Portugal-based bank, from Lone Star Funds in a transaction valued at approximately €6.4bn.

The deal is the most substantial cross-border acquisition in the eurozone in over ten years and is part of BPCE’s VISION 2030 strategic plan, designed to expand its operations in France, Europe, and beyond.

Once finalised, the acquisition will make Portugal the group’s second-largest domestic retail market. Novobanco holds a 9% share in the individual customer segment and 14% in the corporate client sector within Portugal.

The bank serves 1.7 million individual clients and manages a corporate loan portfolio worth €17bn. Employing 4,200 staff, novobanco operates 290 branches and works with an extensive network of external partners.

In recent years, novobanco has become one of Europe’s more profitable banks, achieving a cost-income ratio below 35% and a return on tangible equity over 20%.

The acquisition offers BPCE geographical diversification by entering Portugal’s vibrant economy and enhances its balance sheet by increasing the share of variable-rate loans, thereby boosting its revenue structure.

This move follows the establishment of BPCE Equipment Solutions earlier in 2025 and an ongoing project to form a leading European asset manager with Generali. Following the acquisition, BPCE’s Common Equity Tier 1 (CET1) ratio is expected to stay above 15%.

BPCE will consult with employee representative bodies before signing the acquisition agreement. The deal is expected to close in the first half of 2026.

BPCE CEO Nicolas Namias said: “Novobanco possesses excellent fundamentals, strong growth potential and an already high level of profitability. For its part, BPCE is a major banking player in France notably thanks to the Banque Populaire and Caisse d’Epargne banking networks.

“With the acquisition of novobanco, BPCE would become a retail banking player in Europe and would actively participate in financing the Portuguese economy. The projected transaction marks a key stage in the execution of its “Vision 2030” strategic plan, announced close to a year ago.

“BPCE’s executive managers and employees are all particularly enthusiastic about the prospect of welcoming novobanco, its management and its 4,200 employees, in order to write a new chapter of growth, innovation and performance in Europe together.”

Original Story: Future Banking | Author: Pradeep Bairaboina
Edition: Prime Yield

Bank of America won the bid for Santander’s €90 million hotel RPL portfólio

16 June, 2025

Banco Santander has completed a new hotel financing deal. The bank has awarded Bank of America a portfolio consisting of eight loans to Spanish hotel establishments with a gross value close to €90 million. These loans were previously affected by collection issues or refinancing within the last year, but are now up to date with payments (a type of asset known as ‘reperforming’ in the jargon).

Other investors, such as Cerberus, Golden Tree and Ben Capital, were interested in the portfolio, dubbed Project Cosmos. These large, unique transactions are priced better than portfolios comprising thousands of borrowers, which typically make up mortgage, consumer credit or corporate and SME portfolios, because investors can perform a more detailed analysis of each borrower.

This transaction is similar to last year’s Zeta portfolio, which was a loan portfolio to the hotel sector with a gross nominal value of almost €300 million. According to El Confidencial, JP Morgan acquired this portfolio for around €200 million. The portfolio comprised financing for six hotel clients, with guarantees on 30 hotels.

Unique loans

The sale of unique and individual loans has become increasingly popular in bank debt divestments as a means of alleviating balance sheet provisions, following the major clean-up that took place in the past with the sale of large portfolios of non-performing assets worth billions of dollars.

Overall, banks have adopted this approach to asset disposal to keep default rates under control and transfer the management of these assets to specialists. Banco Santander is one of the most active banks in this area. In recent months, it has finalised transactions such as the Rock portfolio, which involved the acquisition of 90 million euros of secured financing by the KKR fund, and the transfer of 250 million euros of real estate and debt to Fortress and Balbec.

In just over a year, the group has sold portfolios of all kinds, totalling more than 3.2 billion in gross nominal value. At the end of March, its default ratio stood at 2.99%, down from 3.10% a year ago, with provisions covering 65.7% of doubtful financing. The balance of impaired assets stood at €34.992 billion and it had an insolvency fund network worth €22.98 billion.

According to the latest data published at the end of 2024, it also had a portfolio of foreclosed assets amounting to €4.823 billion, down from €5.506 billion the previous year. This figure is reduced to €2.131 billion when the €2.692 billion accumulated in provisions to cover the impairment of their value is deducted.

17.8 billion market

According to Axis Corporate data, the portfolio sales market closed transactions last year for a gross nominal value of €17.86 billion, although only €6.7 billion was for new asset disposals by financial institutions, with the remainder corresponding to transactions between investors despite the assets’ banking origin. One of the largest transactions was carried out by Sareb, with a nominal value of €1.5 billion.

Original Story: El Economista | Author: Eva Contreras
Edition and translation: Prime Yield

Banks and servicers point the finger back at the State’s bureaucracy

12 June, 2025

Greece’s housing market is gridlocked by bureaucracy, say both banks and servicers.

Eurobank CEO points the finger back at the state, arguing that it is government-imposed conditions, particularly those tied to property legalization and digital registration, that are delaying housing sales.

Greece’s banks, loan servicers, and investment funds currently hold an estimated 25,000 properties, according to official data. Yet most of these remain unsold, prompting the government to accuse the asset managers of deliberately holding back supply in a bid to extract higher profits.

The result, officials argue, is a limited housing stock that fails to ease soaring demand—especially from abroad—driving prices even higher and making homeownership unattainable for younger households.
However, both banks and servicers strongly reject this claim.

Fokion Karavias, CEO of Eurobank, firmly counters the government’s position, stating that financial institutions have every incentive to sell these assets as quickly as possible. He points the finger back at the state, arguing that it is government-imposed conditions, particularly those tied to property legalization and digital registration, that are delaying sales.

Under current rules, properties must be fully legalized in terms of planning permissions, zoning, and other regulatory requirements before they can be transferred. Banks and servicers can acquire them as-is but can’t resell until all issues are resolved.

This regulatory bottleneck, Karavias insists, is the true cause of the limited supply on the market. He notes that legalising properties and securing digital IDs is a long and complex process, often dragging on for months or even years.

Eurobank and others have suggested allowing property sales without prior digital registration, transferring the responsibility to buyers—but the Finance Ministry has rejected the proposal. Karavias criticises the rigid stance, especially given that only a small fraction of Athens’ housing stock currently has a digital ID.

Theodore Kalantonis, head of doValue Greece, also proposed shifting responsibility for legalizing properties to buyers for a year to help ease supply pressures. He warns that lengthy red tape delays sales and that mortgage approvals now take six months—far longer than the 45 days needed before the crisis—often stalling deals.

Kalantonis warns that mounting delays risk undermining Greece’s edge in real estate, once known for fast deals. He urges the government to cut red tape, starting by letting buyers handle property legalisation and digital IDs, to ease the country’s housing crisis.

Original Story: Tovima
Edition: Prime Yield
Image by Reissaamme from Pixabay

Credit institutions are losing market share despite the expansion of consumer credit

9 June, 2025

According to the Bank of Spain’s Spring 2025 Stability Report, credit institutions (EFCs) slightly reduced their market share in 2024 compared to 2023, despite the expansion of consumer credit.

In 2024, the share of consumer credit provided by these institutions and banks combined was 20.1%, which is half a percentage point lower than in 2023.

The Bank of Spain notes that this decline contrasts with the general upward trend of the last decade, occurring amid an expansion of consumer credit across the entire system. It highlights that these loans grew by 7.3% in the banking sector in 2024, but by only 4.4% in finance companies.

‘This difference in growth between the two groups in 2024 is partly due to some banks absorbing the consumer credit activity previously provided by financial credit institutions that consolidated with them,’ the report notes. A similar effect occurred in 2020, a year impacted by the Covid-19 crisis.

Using data from 2025, the Bank of Spain reports that the downward trend in the share of finance companies continued during the first quarter, standing at 19.2%.

Evolution of non-performing loans

The Bank of Spain also addresses the credit quality of this segment. It notes that the ratio of non-performing loans for finance companies rose slightly to 3.5% in 2024, an increase of 0.1 percentage points. However, this remained below the ratio of 4.3% for banks in the same product segment.

The ratio of consumer loans from financial institutions under special surveillance fell by one percentage point last year, standing at 6.2%, while for banks as a whole it stood at 7.3%.

Finally, in the first quarter of 2025, there was a slight deterioration in credit quality, with increases in the ratios of doubtful loans (up 0.4 points to 3.9%) and special surveillance loans (up 0.5 points to 6.7%) in this credit segment.

Original Story: Valencia Plaza
Edition: Prime Yield
Image by Roman Ivanyshyn from Pixabay

Government puts pressure on servicers to release closed houses

3 June, 2025

The government would like to see the thousands of closed properties managed by servicers reopen and begin to return to the market, considering that they will constitute an important source of supply reinforcement.

The issue was discussed last May 29th among others, by Minister of National Economy and Finance Kyriakos Pierrakakis and Bank of Greece Governor Yannis Stournaras, in a meeting at the central bank, while in the afternoon a meeting was held on the same issue at the Ministry of National Economy, under Pierrakakis, with the participation of the servicers and Bank of Greece Deputy Governor Christina Papaconstantinou.

The goal is to regulate the loans corresponding to these properties, so that they can be put back on the market not be auctioned off. A systemic solution is being sought in this direction, a source has told Kathimerini. However, the same source acknowledged that the solution will not be easy, given that it is a problem that has accumulated over the years.

In any case, the government has put housing at the center of its policy, as this has emerged as a top problem. To this end, it is attempting to bring as many as possible of the approximately 800,000 closed properties onto the market, according to the calculations of representatives of the real estate market.

For individuals who keep their properties closed, the government will move with a carrot-and-stick logic, providing incentives for owners to open their closed properties and establishing disincentives for those who insist on keeping them closed.

At their meeting, Pierrakakis and Stournaras agreed that the Savings and Investment Union, which is promoted by the European Commission, is positive and they support it.

Pierrakakis added that the barriers between European economies must be removed. “As Mario Draghi has mentioned,” the minister explained, “the barriers that exist in the service sector are equivalent to corresponding tariffs of around 110%.”

Original Story: Ekathimerini | Author: Eirini Chrysolora
Edition: Prime Yield
Image by Thomas G. from Pixabay

Bank of Spain warns of slowing lending income growth

2 June, 2025

The Bank of Spain has just warned that lenders’ income growth was likely to slow down this year amid lower interest rates and geopolitical risks, and it would need to closely monitor the credit quality of bank loans.

In its latestt semiannual financial stability report, the central bank said the credit quality was now at favourable levels, but it could deteriorate if a potential economic slowdown weighs on borrowers.

The ratio of bad loans has been stable in Spain a little above 3% in late 2024 and early 2025, far below the all time-high of 13.6% in December 2013.

Banks’ net interest income has fallen 3.9% in the first quarter, the central bank said, after rising 22% in 2023 and 8.8% in 2024.

It also said the much-delayed implementation of the Basel III international capital rules remained a priority as it would prevent accumulation of global systemic risks. The rules should be consistent with the planned revision of the European Union’s supervisory framework, it said, to make the framework simpler without undermining the banks’ resilience.

Original Story: Reuters | Author: Jesús Aguado
Edition: Prime Yield
Image by Gundula Vogel from Pixabay