NPL&REO News

DBRS: NPL will increase, but how much is still uncertain

The impact of the withdrawal of advanced measures due to the pandemic is not certain, but it should lead to an increase in non-performing loans. The deterioration will depend on the economic recovery of countries, says DBRS.

Portuguese banks managed to reduce non-performing loans (NPLs) during the pandemic, and this, along with the provisions made, improved the banks’ coverage ratio, according to rating agency DBRS. Still, it is necessary to wait and see the effects of the reversal of the support measures. In addition, DBRS also notes that Portugal still has several moratoria pending and the effect on credit is still uncertain.

According to the data from EBA, the NPLs of Portuguese banks “declined significantly between Q4 2019 and Q2 2021 (-42%), also leading to an improvement in the NPL ratio to 4.2% at the end of Q2 2021 from 6.5% at the end of Q4 2019″, DBRS signals in a commentary where it analysed the situation in Italy, Greece, Spain, Portugal, Ireland and Cyprus.

In addition, Portuguese banks have also increased provisions since the end of Q4 2019, which, together with the reduction in NPL, “resulted in the banks’ coverage ratio improving to 58.4% at the end of the second quarter of 2021 from 50.1% at the end of the fourth quarter of 2019”, they add.

The rating agency also notes that while Spain, Ireland, Greece and Cyprus “evenly distributed NPLs between households and non-financial companies”, in the remaining NPLs in Italy and Portugal non-financial companies have more weight. This suggests a pipeline skewed towards small and medium-sized enterprises and corporate loans, rather than individual borrowers, in Italy and Portugal.

Already looking at moratoria granted, EBA-covered banks in Portugal had 73% still outstanding at the end of Q2 2021, followed by EBA banks in Italy (23% of total moratoria granted) and Spain (13% of total moratoria granted) at the end of Q2 2021.

To do this analysis, DBRS also looked at the evolution of key metrics, forecasting that unemployment in Portugal will have a slight drop in 2022. Growth in the Portuguese economy will also be higher next year, unlike the other countries analysed. In terms of property prices, Portugal is well above the other countries, having shown a very sharp upward trend

DBRS thus concludes that the “comprehensive response from European governments and the EC has so far been effective in preventing an increase in NPLs” in these jurisdictions in the short term. Unemployment and residential property “have performed better than expected in these jurisdictions, with Portuguese property price increases outperforming other jurisdictions”, they stress.

The agency also notes that the effects of the reversal of the relief measures have yet to be assessed, with NPLs expected to increase, but “deterioration will depend on several factors, including the country’s full economic recovery.

Original Story: ECO | Mariana Espírito Santo 
Photo: Big Stock Photo
Translation & Edition: Prime Yield

Portugal’s six main banks report a combined €1.04 billion profit until September

Six of the main banks operating in Portugal had a combined €1.043 billion in profit in the first nine months of this year, contrasting with combined losses of €178 million in the same period of 2020.

Contributing to the turnaround was, above all, Novo Banco which went from losses of €853.1 million in the first nine months of 2020 to a profit of €154.1 million in the same period this year.

This year is the first in which the bank – which created in 2014 to carry on the commercial business of Banco Espírito Santo, which that bank was wound up – has had a positive result.

The highest nine-month profit was that of state-owned Caixa Geral de Depósitos (CGD), which reported €429 million, up 9.4%.

BPI, meanwhile, almost tripled its profit to €242 million.

BCP and Santander, by contrast, saw their profits fall. BCP’s fell 59.3% to €59.5 million and Santander’s 32% to €172.2 million.

Banco Montepio, for its part, narrowed its nine-month loss to €14 million from a €57 million loss a year earlier.

Despite the renewed profits for most banks, executives said that profitability in the sector remains very low in relation to the money invested by shareholders.

At CGD’s results presentation, CEO Paulo Macedo said that in recent years the aggregate profitability of banks has been negative and stressed that shareholders’ money has to be remunerated.

“There are those headlines that banking earns I don’t know how much a day, when Caixa has 9.4 billion euros in capital that it has to remunerate,” he said. “It has to return money to taxpayers.”

Macedo announced that CGD would pay in November an extraordinary dividend of €300 million to its sole shareholder, the Portuguese state, in addition to the €83.6 million already paid out this year.

He added that although the CGD results were very positive, the future business conditions it faces are “very difficult”.

Banking consolidation, a recurring issue in recent years, was one of the themes of the results presentations.

BCP’s CEO, Miguel Maya, said it was not looking to make any acquisitions: “Let that be clear.”

BPI’s CEO, João Pedro Oliveira e Costa, also said that the bank he runs took a similar view: “We are not focused there and it is not just talk, it is not our point.”

Novo Banco’s CEO, António Ramalho, by contrast, said that it may weigh up the purchase of smaller banks in good time.

“We will look at all growth hypotheses, especially in the second tier of banks,” he said, stressing that possible acquisitions can be made from the moment the bank concludes its own restructuring process.

In terms of the moratoria on loans, which ended for most at the end of September, the bank CEOs said they were not too worried about defaults, noting that – despite there being problems – the vast majority of customers were paying their debts regularly. But they also said that the situation would evolve depending on economic developments and employment.

In August, the government approved legislation to force banks to restructure oustanding loans to customers who, after the moratoria, have problems paying their debts. CGD has already restructured loans to 3,000 households (totalling €330 million) and 600 companies (with a total €150 million); other banks have not disclosed these figures.

Original Story: Macau Business |Lusa 
Photo: Photo by Armindo Caetano in FreeImages.com
Edition: Prime Yield

Montepio to sell 300 million NPL “Project Gerês” portfolio

Bank Montepio is analysing the transfer of between 1 and 2 billion euro in toxic assets to a specialised vehicle, aiming to perform a «carve-out» operation. And has already placed a new 300 million euros NPL portfolio on the market.

Named “Project Gerês”, this is a granular NPL portfolio, whose sale process is being managed by KPMG. The 300 million euro concern the gross value of the credits, excluding the impairments registered by the bank for this set of contracts and loans.

The bank has one of Portugal’s highest toxic asset rates, having registered in June an NPE (Non-Performing Exposure) ratio of 9.3%, according to the second quarter’s statements. During the same period, the banking system showed an NPL rate of 4.3%, below the 5% rate required by the European authorities.

Original Story: Iberian Property |Ana Tavares 
Photo: Montepio website
Edition: Prime Yield

Millennium bcp set to sale the €100 million “Project Lucia”

Millennium bcp bank has put for sale the Project Lucia, a portfolio consisting of 60 million euros in nonperforming loans (NPL) and further 50 million euros in real estate owned (REO) assets. The sales process is being led by KPMG.This isn’t the only portfolio that the Portuguese bank has currently in the market. In August, bcp had already put Project Green up for sale, a 160 million euros portfolio composed of NPLs and REO from the Castro Marim and Monte Rei luxury resorts, both in Algarve.

However, the Castro Marim resort properties would be excluded from the portfolio, due to the low bid values offered by investors. The assets from Monte Rei remain though, but it isn’t certain that the deal will be concluded due to the value of the offers on the table, according to what several sources knowers of the process told to ECO. Bank of America Merrll Lynch and Bybrook are the bidders.

Original Story: ECO News | News 
Photo: Millennium bcp website
Edition: Prime Yield

Savings from companies in Portuguese banks reach a new historic high

The Bank of Portugal (BoP) announced that deposits by companies in resident banks increased 16.3% in August compared to the same month in 2020, reaching a new historic high of 58.8 billion euros.

“Concerning deposits by individuals in resident banks, which in July had reached a record €169.9 billion, grew by 7.1% in August, year-on-year, adding 169.3 billion euros (they had increased by 6.6% in the previous month).”

According to the BoP, “since March 2020, households have increased their deposits with banks”, with this growth “a trend and values close to those of the euro area”.

Regarding the total amount of loans granted to households for housing, it grew by 4% year-on-year to 95.6 billion euros, after increasing by 3.9% in the previous month.

Consumer loans grew by 1.3% year-on-year to 19 billion euros in August 2020 (they had increased by 1.6% in the previous month).

Regarding companies, the total amount of loans granted in August 2021 grew by 5.2% year-on-year to 76.2 billion euros, decelerating slightly from the 5.9% increase in the previous month.

“Contrary to the evolution seen in 2020 and early 2021, largely related to the impact of the lines of support for the economy granted in the context of the pandemic, the pace of growth in loans to companies has once again slowed for the fourth consecutive month,” says the central bank.

“Still – it adds – loans to businesses have been increasing at a faster pace than observed in the euro area.”In August, the reduction in the pace of growth of loans to businesses “was across all size classes”

Original Story: Eco  News |  Lusa
Photo: Bank of Portugal website
Edition: Prime Yield

NPL ratio fall to new low before moratoria end

As the Portuguese banks continue to clean up their balance sheets, this has been reflected in an improvement in the levels of non-performing loans (NPL), despite the impact of the pandemic. The NPL ratio stood at 4.3% at the end of June, down 0.6 percentage points from the end of 2020. Still, NPL stock amounted to €13.5 billion.

After peaking in 2016 (17.9%), the NPL ratio have maintained a downward trajectory in recent years; a trend that the Covid-19 pandemic has not yet halted, although the reduction has been at a less intense pace in recent quarters.

Over the past four and a half years domestic banks have cleared more than €30 billion of non-performing loans from their balance sheets and managed to achieve a ratio below the 5% that is required by national authorities. The NPL ratio is today at its lowest level since 2008, according to official statistics.

If we count impairments, the NPL ratio is even lower: 1.9%, representing about €5.99 billion in toxic loans.

Original Story: Eco | Alberto Teixeira 
Photo: Photo by Armindo Caetano in FreeImages.com
Edition & Translation: Prime Yield

CGD and Novo Banco choose the buyers for their NPL portfolios’ by mid October

Portugal’s Novo Banco (NB) and Caixa Geral de Depósitos (CGD) have two portfolios of non-performing loans (NPLs) for sale, called Harvey and Mercury, respectively. Tenders for the purchase of the respective portfolios are in the final stages and there are several interested parties in the race, and buyers/winners should be chosen on 15 October, 2021. 

According to the newspaper Jornal Económico, which quotes a market source, there are three candidates in the final stage of the tender to buy the NPL Harvey portfolio and four in the final race for Mercury. 

For each of the operations four interested parties have been chosen to move on to the negotiation phase, but in the case of NB one of the candidates, Bank of America Merrill Lynch, will not move forward, the paper said, adding that the three finalists for the Harvey project are the DDM Group, Deva Capital and DK Partners.

At stake are the debts of 20 single names – eight corporate and 12 real estate-related -, with the Project Harvey project encompassing NPL with a gross value of 640 million euros. 

As for the Mercury portfolio, one of the four funds interested in buying is, according to Jornal Económico, the North American Cerberus. This is a granular portfolio and not of large debtors, with CGD’s portfolio being of collateralised (secured) NPL. 

The Mercury portfolio comprises 100 million euros of residential NPL and a small pool of REOs [real estate owned] in the amount of 10 million euros.

Original story: Jornal Económico | Maria Teixeira Alves 
Photo: CGD website
Translation & Edition: Prime Yield

Portugal’s 5 larger banks with aggregated profits of €708 billion

The five main banks based in Portugal recorded, in the first half of the year, an aggregate profit of €708.4 million.

Together, Caixa Geral de Depósitos (CGD), Novo Banco, BCP, BPI and Santander Totta recorded aggregate profits of €708.4 million.

Novo Banco announced profits of €137.7 million in the first six months of the year, an improvement compared to the losses recorded since its foundation, in 2014.

Caixa Geral de Depósitos (CGD) recorded the highest profit among the five largest banks, with €294 million in the first half, after €249 million in the same period last year.

The second largest contribution came from BPI, with €183 million in profit, which compares with the 43 obtained in the first six months of 2020.

In fourth place, after Novo Banco’s profits, which place it in third place in the table of positive net results, was Santander Totta, with a profit of €81.4 million in the first half, compared with €172.9 million in the same period of 2020.

Finally, BCP profited €12.3 million, greatly impacted by losses of €112.7 million in the Polish operation, when it had profited €76 million in the first half of 2020.

Original Story: The Portugal News | TPL/ Lusa 
Photo: CGD website
Edition: Prime Yield

BCP looks for new owners for a €145 million REO and NPL portfolio

Portuguese bank BCP is looking for new owners for a portfolio made of nonperforming loans (NPL) and real estate (REO) in Algarve with a gross value of 145 million euros, according to digital ECO News. 

Most of the assets are connected to the luxury resorts Castro Marim and Monte Rei, with the portfolio in question to be named “Project Green” after the golf camps included in those touristic complexes. It also includes other real estate assets located in Tavira, São Brás de Alportel and Loulé, notes Eco.

According to the same source, the bank lead by Miguel Maia is already in the market taking conversations with interested potential buyers.

Castro Marim and Monte Rei resorts had initially been included in the “Project Ellis”, which sale to David Kempner was completed by the end of 2020. At the time, they were reportedly taken from that portfolio.

With over 400 hectars of land. Monte Rei is located a few kilometres from Vila Nova de Cacela, and includes villas, houses, flats and plots for construction, besides golf courses designed by the American Jack Nicklaus. The Castro Marim resort also has golf courses, villas and individual plots.

Original Story: Jornal de Negócios | Staff
Photo: MBCP website
Edition & Translation: Prime Yield

CGD, Santander and Novo Bank relaunch NPL sales

Caixa Geral de Depósitos will go ahead with the sale of a nonperforming loan (NPL) portfolio of more than 120 million euros in the second half of the year. 

According to Economico, the Portuguese State owned bank has already launched the sales process of the Mercury Project, a granular portfolio of collateralised NPLs with a total value of 128 milion euros, and which not include NPL from large debtors.

At the same time, the Portuguese diary added, both Novo Banco and Santander Totta are also triggering the sale of their own NPL portfolios. 

Original Story: Jornal Económico |Maria Teixeira 
Photo: CGD Website
Edition & Translation: Prime Yield

NPL won’t be a brake on credit

The “expectation of continued support for the most affected sectors” by the pandemic together with the end of the moratoria regime leads the Portuguese banks to rule out an increase in credit restrictions. And this time, bad credit won’t be a brake to new financing, concludes the Bank of Portugal (BdP) in one of its latest papers, according to a new from ECO.

“Progress made by the banking system since the last crisis to make it more robust and resilient to shocks will be contributing to a lower impact of NPLs on lending.”, says the BdP.Even with the deadline for the moratoria ending in September, the surveyed banks are calm. According to the Bank of Portugal, the largest national financial institutions “expect the NPL ratio to have practically no impact on lending criteria,” which, according to the survey, have become only slightly more restrictive than before the pandemic.

Original Story: ECO |Paulo Moutinho
Photo: Banco de Portugal website
Edition & Translation: Prime Yield 

Novo Banco puts the €640 million NPL Harvey Project for sale

Novo Banco has just put an 640 million portfolio of nonperforming loans (NPL) of major debtors up for sale. The institution led by António Ramalho wants to reduce the bad debt ratio from 8% at the end of March to 5% within two years.

With a gross value of 640 million, the Harvey Project is set up of loans in default from the bank’s 20 major debtors, including 8 corporate loans and 12 other loans linked to the real estate sector.

According to the online Eco news this is the new name given from the bank to the credit portfolio that was supposed to be Nata III.

Original Story: Jornal de Negócios | Staff
Photo: Novo Banco website
Edition & Translation: Prime Yield 

Altamira Portugal expects 1 billion in new NPL until the end of the year

The new CEO of Altamira Portugal, Isabel Teixeira, is expecting a significant increase in new nonperforming loans (NPL) coming to the market within the news few months, she said in an interview to Económico.

Isabel Teixeira admits that by the end of the year the amount of NPL coming onto the market will reach the global value of 1 billion euros. “There are portfolios entering the market coming from practically all banks, and whose tenders are expected to take place by the end of the year,” the manager acknowledged.

In the same occasion, Altamira’s responsible in charge of the Portuguese market also spoke of the possibility of the state seeing the guarantees provided in the Covid lines executed and therefore being able to become a seller of NPLs, alongside the banks.

Original Story: Jornal Económico |Maria Teixeira Alves 
Photo: Altamira Linked In
Edition & Translation: Prime Yield

Novo Banco’s owner sold “Vilamoura” to Arrow for €100M

The US-based Lone Star has sold “Project Vilamoura” to a group of investors, including British fund Arrow Capital and businessmen Filipe de Botton and Alexandre Relvas.

The US-based Lone Star has closed the sale of the Vilamoura Project – which includes, literally, a part of Vilamoura – to British Arrow Capital and a number of investors, including Filipe de Botton and Alexandre Relvas, according to ECO. The “package” includes the Vilamoura marina, two companies and 21 plots of land with construction potential. The operation was closed for about 100 million euros, a value well below what was being asked initially, since the project also included Cidade Lacustre (expansion), which ended up being rejected at the end of last year.

It was in 2015, in a “competitive” process, that the owner of Novo Banco bought these assets. Two years later, at the end of 2017, it put them on the market for sale. Among some obstacles, it took another three years to get them sold. The deal was closed last week, according to ECO, and should have been around €100 million, a figure below the €180 million that Lone Star was initially asking for.

On the buyer’s side is the British fund Arrow Capital, which owns the Portuguese companies Whitestar and Norfin, and a number of private investors, including Filipe de Botton and Alexandre Relvas, partners of Logoplaste, and João Brion Sanches, founder of Norfin along with the two previous entrepreneurs. Contacted by ECO, both the Arrow Group and Filipe de Botton declined to comment.

The project comprises 100% of Vilamoura World’s share capital (the company that manages all these assets), 21 plots of land for development, 49% of Inframoura (the municipal company that manages Vilamoura’s public works) and, finally, the marina, which is the most interesting asset. “Opened in 1974, it is the largest in the country with 825 berths,” reads the project teaser to which ECO had access. The marina concession is valid until 2060.

In recent years, several projects have been completed in Vilamoura, resulting in 704 homes in the pre-crisis period (Victoria Boulevard, The Victoria Gardens, 1st phase of L’Orangerie, Villa Rosa Golf, Monte Laguna, The Victoria Residences and Laguna Golf) and 219 in the post-crisis period (Gardens Vilamoura, Laguna Village, 1st phase of Uptown, 2nd phase of L’Orangerie, Villa Nature and the 1st phase of Central).

For the future, among the various projects planned, there will be 3,658 housing units, totalling 566,374 square metres, says the teaser.

Original Story: Eco |Eco News
Photo: Vilamoura World Site
Edition: Prime Yield

Portuguese banks brace for worsening asset quality in 2021

Loan moratoria and other policy measures have protected Portuguese banks’ asset quality so far during the COVID-19 pandemic, but this may change in 2021 as many programs are unwound, DBRS Morningstar said in a report April 8.

Despite a doubling of loan loss provisions, the stock of nonperforming loans at a group of Portugal’s largest banks shrunk by more than a fifth in 2020, the credit rating agency estimated. Its sample included Caixa Geral de Depósitos SA, Banco Comercial Português SA, Novo Banco SA, Banco Santander Totta SA, Banco BPI SA and Caixa Económica Montepio Geral.

Banco de Portugal data shows a similar trend for the whole banking system, with 2020 loan loss charges — measuring total credit impairments as a percentage of average gross customer loans — nearly doubling to 1.03% from 0.52% in 2019, and the NPL stock dropping to €14.36 billion in 2020 from €17.20 billion a year ago.

NPL sales, write-offs and cures helped reduce the bad loan stock in 2020 and COVID-19-related policy measures have staved off the impact of the economic downturn on banks’ credit portfolios, DBRS Morningstar said.

“Our view is that asset quality may deteriorate from late 2021 with the eventual loosening of moratoria and other support schemes,” Nicola de Caro, senior vice president at the global financial institutions team of DBRS Morningstar told S&P Global Market Intelligence.

With over 20% of total loans under moratoria, Portugal’s banks are among the most dependent on such pandemic support schemes in Europe. The majority of these loans comprise exposures to small and medium-sized enterprises which are set to expire in the third quarter of 2021, DBRS Morningstar said.

At 2020-end, Portugal’s banking system had the third-largest stock of loans and advances under moratoria, of €41.5 billion, according to data by the European Banking Authority. Italy and Spain ranked first and second with a stock of €115.6 billion and €57.9 billion, respectively.

Bad loan risk

According to current estimates out of Portugal, up to 10% of loans currently under moratoria could “go bad” in the future, Olivia Perney Guillot, managing director at the financial institutions team of Fitch Ratings, said in an interview. Fitch expects asset quality to deteriorate in 2021 but some banks in southern Europe will be able to offset some of the negative impact through NPL sales and write-offs as they did in 2020, Rafael Quina, on the financial institutions team at Fitch Ratings, said.

The NPL ratio for loans in already-expired moratoria schemes in Portugal stood at 2.8% at the end of 2020, almost as high as the 2.9% in Italy but lower than the 4.2% in Spain, EBA data shows.

There will be wide differences in risk depending on the borrower type, Quina said. Residential mortgages, for example, would be typically less risky than exposure to unable-to-pay SMEs that are in the tourism sector, he told S&P Global Market Intelligence.

Based on its exposure, Portugal is the fourth most-dependent country on the tourism sector in the eurozone, DBRS Morningstar estimated in a Sept. 14, 2020 report. The country ranked second by the share of tourism sector contribution to GDP — 16.5%, and third by the share tourism employment to total employment — 18.6%, according to the report.

“In DBRS Morningstar’s view, the longer the epidemiological situation continues, the greater the risk that the travel and tourism industries in these countries will suffer more lasting damage, resulting in permanent job losses and closures of some businesses. Even after the travel restrictions are largely lifted across geographies, the fear of travel might linger for longer,” the rating agency said at the time.

Original Story: SP Global| Vanya Damyanova
Photo: Photo by Alfonso Romero from FreeImages.com
Edition: Prime Yield

Government negotiates loan for a further injection into Novo Banco

The Portuguese government is trying to arrange finance so that the Resolution Fund can channel another tranche of money into Novo Banco.

The bank that emerged from the BES debacle has asked for €600 million this year (when the State Budget only allowed for €475 million). 

The government apparently seems prepared to spend €400 million, but first it has to raise it. Bloco de Esquerda has said Novo Banco should get another cent.

Original Story: Portugal Resident| Natasha Donn
Photo: Novo Banco website
Edition: Prime Yield

Almost a third of Portuguese companies in state of “significant debt”

Roughly 30% of Portuguese companies suffered “significant defaults” in 2020 despite the various State led injections of liquidity and fiscal stimuli designed to “atentuate the economic effects provoked by the pandemic”, reveals a study on ‘management of credit risk’ promoted by Spanish agencies Crédito y Caución and Iberform.

Original Story: Portugal Resident| Natasha Donn
Photo: Photo by Pasqualantonio from FreeImages.com
Edition: Prime Yield

Portugal’s frozen loan repayments decline further in the beginning of the year

The volume of loan repayments suspended by Portuguese banks under a scheme to help businesses and individuals through the pandemic slipped in January to 45.7 billion euros ($54 billion), further retreating from a peak in September.

The latest figure released by the Bank of Portugal compares with 46.1 billion euros of the so-called loan moratoriums, including capital and interest, in December and an all-time high of 48.1 billion in September.

The central bank said 54,000 companies had access to the scheme in January, for a total of 24 billion euros, or 33.2% of total corporate loans.

“The accommodation and restaurant companies were the ones that stood out the most, with 57% of their total loans covered by this measure,” it said, without giving further details.

Portugal’s once-booming tourism sector suffered its worst results since the mid-1980s last year due to the pandemic.

Private individuals suspended 20 billion euros of loan repayments, or 16% of their total loans, the financial authority said, adding that mortgage loans made up 86% of that amount.

The freeze, in part aimed at avoiding a jump in bad loans at banks that spent the past five years reducing their ratios of non-performing loans, will end on Sept. 30. Some loans, namely mortgage loans, will start paying interest as of April.

Portugal’s largest listed bank Millennium bcp wants the government to extend the loan repayments freeze for pandemic-hit tourism companies beyond September if the health crisis has not been overcome by then, Chief Executive Officer Miguel Maya said in February.

Portugal’s lenders have cut their average non-performing loan (NPL) ratio to around 5% of total credit, but it is still almost twice the European average. 

Original Story: Reuters | Sérgio Gonçalves 
Photo: Photo by Armindo Caetano from FreeImages.com
Edition: Prime Yield

Portuguese Government is discussing extending credit moratoria with banks

Economy Minister Pedro Siza Vieira admitted, earlier on February, the extension of credit moratoria or other solutions to support the payment of these credits. “We are discussing what to do about the debt that exists and, eventually, an extension of maturities may be justified in this sector,” the minister said in a webinar.

The minister admitted that he is discussing the issue of moratoria with the Bank of Portugal (BoP) and the Portuguese Banking Association (APB). On the table “it is being discussed not only the suspension of payments that we determined until September,” but the “extension of even the term of the remaining debt.

He added: “It’s something that we have to see to what extent it is justified, and with what scope”.

The minister’s statements open the door to extending the term of loans, a form of credit restructuring, as some business associations are considering.

Admitting that company reserves are “exhausted” and equity “further destroyed”, Siza Vieira said that the Government “is aware that it will need to launch corporate capitalisation instruments”. “We will need to make a supplementary effort on the public and private side to endure these months,” he added.

In relation to instruments to support this recapitalisation, the minister said that “quasi-equity, convertible debt, or participating loans” solutions were being studied.At the same online conference held on Tuesday, 9 February, promoted by the Portuguese Tourism Confederation, the chairman of BCP Miguel Maya had already advocated strengthening measures to support tourism, including the continuation of credit moratoria for companies and workers in the sector.

Original Story: Público | Rosa Soares
Photo: Photo by Magda S in FreeImages.com
Edition & Translation: Prime Yield

ECS to sell €1.5 billion in restructuring funds

ECS – Sociedade Gestora de Fundos de Capital de Risco was put up for sale at the beginning of the year, in an operation that came public after the company owned by António de Sousa and Fernando Esmeraldo received expressions of interest from international funds, Portuguese daily Jornal Económico reported.

The newspaper said that the proposals that have been received by ECS cover several perimeters, ranging from global purchase offers that cover all funds to partial offers, involving only some of the four active funds. The process has already attracted interest from several international funds, such as Bain Capital, Blackstone, Fortress, Cerberus and Arrow/Norfin.

According to the newspaper, the three largest ECS funds that are up for sale are worth almost €1.5 billion. The proceeds of the sale will go to the banks that own the participation units in these funds: Caixa Geral de Depósitos, BCP, Novo Banco, Santander Totta and Oitante (ex-Banif).

Original Story: Eco|Newsroom
Photo: Palácio do Governador Hotel website
Translation: Prime Yield

Top