Portugal’s BPI has put another non-performing loan (NPL) portfolio up for sale, appointing KPMG as advisor.

The “Zinc” project consists of 99.8 million euros of NPLs, of which 77 million are unsecured and the remaining 22 million are considered risky but secured. This portfolio comprises NPLs from households (66%) and SMEs (34%) and is divided into two tranches.

 Tranche A is divided between households (58 per cent), SMEs (26 per cent) and insolvent SMEs (16 per cent). Tranche B, on the other hand, mainly concerns private borrowers with mortgage loans (93 per cent).7 The portfolio is quite granular, with an average loan size of around EUR 13.7 thousand. The private segment in tranche A has an average loan size of around EUR 7.3 thousand. Tranche B is secured by a number of real estate guarantees with a real estate value from the seller of around 37.6 million euros, 99% of which is classified as first lien.

The Bank has opened the non-vincible bidding for the month of April and expects to complete the sale process by mid-year.

Original Story: Jornal Económico | Author: Maria Teixeira Alves
Edition and translation: Prime Yield
Photo: jakub-zerdzick / Unsplashed

BCP has already closed the sale of its non-performing loan (NPL) portfolio, dubbed ‘Project Bright’.The winner was Hoist Capital, which was competing against the consortium of LX Partners and Balbec; EOS Partners; and LC Partners.

Jornal Económico understands that Hoist paid 16.5 million for the Non-Performing Loans portfolio, a portfolio with a nominal value of 80 million euros and made up of ‘unsecured’ credit, i.e. without real guarantees. This usually translates into heavily discounted operations.

These sales are aimed at cleaning up the balance sheet of problematic assets that weigh on the bank’s capital. BCP reached the end of 2024 with 134 million euros less in loans classified as Non-performing exposures (NPE) in domestic activity, closing the year with 973 million in non-performing loans, of which 373 million are loans in default for more than 90 days. The bank led by Miguel Maya has 90 per cent of its loans in Portugal classified as NPE covered by impairments.

In terms of real estate received for credit recovery, BCP reported that it fell from a (gross) value of 169 million euros in December 2023 to 92 million in 2024.

BCP sold 569 properties last year (compared to 820 in 2023), with a book value of 58 million, for 81 million euros. In other words, the sale value exceeded the book value by 23 million.

The net portfolio of repossessed properties fell by 51.9 per cent between December 2023 and December 2024.

BCP’s NPE ratio in Portugal in 2024 stood at 1.7 per cent.

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

Fewer costs and bad debts, more profits and deposits: that’s how 2024 looked for Portuguese banks. Not everything was positive: the transformation ratio fell again.

Bank profits in Portugal rose by 13 per cent to a record €6.323 billion in 2024, a year marked by the reversal of interest rates, according to the latest data published by the Bank of Portugal.

At the end of last year, the Portuguese banking system had a return on equity (ROE) of 15.2 per cent, 0.4 percentage points higher than in 2023.

Several factors contributed to the Portuguese banking system’s historic profit last year, including income from interest and commissions, but also the release of provisions and impairments, among others.

On the other hand, banks kept costs relatively under control, with the cost-income ratio rising slightly to 39.7 per cent, 2.7 percentage points higher than a year earlier, but almost 20 percentage points below the level recorded in 2020.

In terms of asset quality, the non-performing loan (NPL) ratio fell again to 2.4 percent in December, 0.3 percentage point lower than a year earlier.

Nevertheless, banks’ balance sheets still contained €7.8 billion euro of NPL, 700 million less than a year ago. Toxic loans net of provisions totalled 3.48 billion.

Indicators for the Portuguese banking system also show that although banks’ total assets grew from 442.2 billion in 2023 to 467.8 billion in 2024, the weight of banks’ assets in relation to GDP fell slightly to 164.2 per cent.

Customer deposits accounted for 73.9 per cent of banks’ assets, up 1 percentage point year-on-year.

The banks’ transformation ratio fell again, reflecting the challenges for banks to inject liquidity into the economy in the form of loans, falling from 78 per cent in 2023 to 75 per cent last year.

Original Story: ECO | Author: Alberto Teixeira
Edition and translation: Prime Yield

In the first quarter of the year, the sale of impaired banking assets is in full swing. At present, assets totalling around €300 million, including nonperforming loans (NPL) and real estate used as collateral, are on the market. This figure is the sum of BCP’s €80 million in NPL, BPI’s €99.8 million in NPL  (part of which is secured by real estate) and the  Zip Project’s 670properties put up for sale by Quest Capital, led by Carlos Vasconcellos Cruz, which manages the portfolio, with an initial valuation of €120 million.

Four parties interested in BCP’s Bright portfolioBCP has four funds interested in its NPL portfolio known as ‘Project Bright’.
The portfolio is worth €80 million and consists of ‘unsecured’ loans, i.e. without any real guarantees. This means that the operations are usually carried out at a large discount.

According to Jornal Económico, there are four binding bids for BCP’s NPL portfolio. In the running are the LX Partners and Balbec consortium, EOS Partners, Hoist Capital and LC Partners.

For its part, BPI has just launched ‘Project Zinc’ with 99.8 million in NPLs (which includes guaranteed real estate in part of the portfolio), of which 22.4 million are guaranteed.

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

The process of transposing the European directive to regulate the sale of non-performing loans, including mortgages and consumer loans in default, continues to be delayed. The bill, which reached Parliament last week, was sent directly to the Committee on Budget, Finance and Public Administration (COFAP), but no date has been set for its discussion.

Parliament’s attention is currently focused on the motion of confidence in the government, which will be debated and voted on this Tuesday and which, given the opposition expressed by several parties, could lead to the fall of the executive and the dissolution of the Assembly of the Republic. If this scenario materialises, the regime for the sale of bad or non-performing loans (NPLs), which should have been implemented by 29 December 2023, will remain suspended, leaving consumers without adequate legal protection, warns Público.

Delays in implementation have already led the European Union to take Portugal, along with other member states, to the European Court of Justice.

Original story: Executive Digest | Author: Pedro Zagacho Gonçalves
Edition and translation: Prime Yield

Diploma transposing EU directive sent to parliament. The delay prompted Brussels to lodge a formal complaint against Portugal.

The draft law transposing the European directive establishing rules for the sale of non-performing loans (NPLs) was already approved by the Council of Ministers (CM). This was the first step towards transposing the directive into national law, the deadline for which was 29 December 2023, prompting the European Commission to take Portugal to the European Court of Justice.

The government has “approved a bill to transpose the European directive, which harmonises the rules applicable to credit managers and credit purchasers and supports the development of secondary markets for non-performing loans (so-called NPLs) in the European Union, while ensuring that the sale of such loans does not prejudice the rights of customers (debtors),” according to the CM’s press release.

No further information has been given on the content of the proposal, but Member States have some room for manoeuvre to protect the interests of individuals, particularly when it comes to the sale of mortgage loans.

The next step in the transposition process will be taken by the Assembly of the Republic, where the government’s proposal will be presented and where a few days ago a bill from the Left Bloc on the sale of NPLs was rejected and two resolutions from the PS and Livre were approved, recommending that the government speed up the transposition and calling for the protection of individuals.

The legislation in question is important for families, as the sale of loans that they have stopped paying has taken place without a specific legal framework, with many individuals being informed of the sale by the buyer. E

At this stage, individuals are given the opportunity to repay the loans, but only in one lump sum, which, if they are unable to do so, results in the loss of the assets pledged as collateral. Individuals often complain about the lack of information and the use of aggressive methods to collect debts, especially when this task is outsourced to other organisations.

In its statement on the opening of proceedings against Portugal, the European Commission stresses that “Directive (EU) 2021/2167 attaches great importance to debtors and includes safeguards to strengthen consumer protection, such as restructuring measures and information requirements to increase the level of transparency in debt collection.

Information requirements to increase the level of transparency in the relationship with the creditor’.

When finally implemented, the effectiveness of the EU legislation will be diminished given the massive sales of non-performing loans already undertaken by banks operating in Portugal in recent years. From 2013 to 2023 alone, banks will ‘cleanse’ their balance sheets of more than 40 billion euros of non-performing loans, a process that will continue in 2024.

Original Story: Público | Author: Rosa Soares
Edition and translation: Prime Yield

Novobanco has already sold the €289 million NPL portfolio it put up for sale in the last quarter of last year. Northwall Capital paid 30.5 million euros. The portfolio will be managed by Whitestar.
Novobanco’s ‘Pegasus’ portfolio of unsecured non-performing loans, i.e. loans in default without real guarantees, has been bought by the UK fund Northwall Capital. Following this acquisition, the management of the portfolio, dubbed ‘Project Pegasus’, was transferred to Whitestar, part of the Arrow Global group, according to our sources.

The ‘Pegasus’ NPL portfolio consisted of 64,000 debtors with an outstanding value of €289 million. Northwall Capital paid 30.5 million euros for the portfolio, according to Jornal Económico.

On 26 September, Novobanco announced to the market that it would start an organised process to sell a granular portfolio of non-performing loans, known as the ‘Pegasus project’, with the aim of signing the transfer contract by the end of the year.

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

From the list of candidates for the purchase of the ‘Solaris Project’, EOS Partners has made the highest bid for the portfolio of non-performing loans (NPL) in Portugal and will therefore win the portfolio of problem assets.

According to sources close to the process, EOS stood out from the other bidders with a bid of €85 million, while the other candidates submitted bids of between €63 million and €66 million.

LCM Partners, Cerberus, Balbec-Lx Partners and NorthWall Capital were also in the running.

In Portugal alone, the value of the NPL portfolio was €870 million. In Spain, the Portuguese servicer put a portfolio of €480 million up for sale.

The ‘Solaris project’ in Portugal consists mainly of loans to individuals totalling €620 million and loans to SMEs totalling €200 million, with an average loan size of six thousand euros.

It is a secondary market operation, competing in the market with other NPL portfolios of major banks such as CGD, Crédito Agrícola, Novobanco, Santander Totta, BCP, Banco Montepio and Bankinter/Universo.

Servdebt, the Portuguese asset management and recovery company, has mandated Alantra to sell its own portfolio of NPLs in the Iberian Peninsula totalling €1.350 billion. The portfolio consists mainly (but not exclusively) of unsecured loans.

Eon Partners is a US-based alternative investment firm that invests in private equity, credit and capital markets.

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

Servdebt Capital Asset Management has completed the purchase of a portfolio of non-performing loans (NPLs) from Abanca, dubbed the ‘Gaia Project’. This is a portfolio of approximately €80 million of NPLs that were on the balance sheet of Abanca in Portugal.

The ‘Gaia Project’ is a portfolio of unsecured loans to individuals and small and medium-sized enterprises owned by Abanca.

The transaction was completed in December.

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

Novobanco has entered into a Non-Performing Loans (NPL) Sale and Purchase Agreement, without guarantees (unsecured) and related exposures (assets).

The announcement was made in a statement and the bank says that the contract was signed following the conclusion of a competitive sale process.

The completion this transaction, under the agreed terms, should have a positive impact on asset quality ratios, reducing the amount of NPLs by around €100 million and the gross NPL ratio to approximately 3.5 per cent (proforma to December 2024), reveals the bank led by Mark Bourke.

‘This is a significant milestone for Novobanco, enabling it to fulfil its strategy of convergence towards the EU average,’ in terms of the ratio of NPL to the total portfolio.

The transaction, carried out for 30.7 million euros, should have a positive impact on the 2024 income statement, contributing around €6 million to Pre-Tax Results and resulting in a 6 basis point increase in Capital Ratios.

The buyer and the name of the portfolio has not been disclosed.

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

Servdebt, the Portuguese asset management and recovery company, has mandated Alantra to sell its own portfolio of non-performing loans (NPL) totalling €1.35 billion, reports Jornal Económico in its weekly edition.

In Portugal alone, the value of the NPL portfolio totalled €870 million euros. In Spain, the Portuguese servicer has put a portfolio of €480 million up for sale.

The NPL – Non-Performing Loans portfolio for sale by the company led by Ana Esteves and Bruno Carneiro is essentially (but not exclusively) unsecured.

The operation, which has been baptised the ‘Solaris Project’, is ServDebt’s own portfolio.

This is a secondary market operation that will compete with other NPL portfolios of large banks.

The value of the bad debt portfolios on the market totalled €2.2 billion, including ServDebt’s portfolio.

The banks CGD, Crédito Agrícola, Novobanco, Santander Totta, BCP, Banco Montepio and Bankinter/Universo have various types of bad debt portfolios for sale, totalling 1.32 billion.

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

The end of the year brought unusual turmoil to the non-performing loan (NPL) market in Portugal. At least seven banks are in the process of selling portfolios of toxic loans worth EUR 1.3 billion, according to information gathered by ECO from various market sources.

These transactions should be completed by the end of the year, one of the sources said. This is in line with the opinion of several analysts consulted by ECO: banks are making a last-ditch effort to clean up their balance sheets before the 2024 accounts are closed.

The biggest operation is by Caixa Geral de Depósitos (CGD), which has put up for sale a portfolio of unsecured NPL worth EUR 460 million under the name Projeto Moon.

Crédito Agrícola has two NPL sales processes underway with a total value of around EUR 280 million: Projeto Lyra, worth EUR 93 million of secured loans  and Projeto Leo, worth EUR 183 million of unsecured loans.

The Crédito Agrícola group is the one that is lagging behind in reducing bad debts (compared to its peers) and is now more active in the market to try to catch up. An official source confirmed that ‘it has sales processes underway that are at an advanced stage, aimed at reducing exposure to NPLs and expected to be completed in 2024′. The ongoing processes are part of the planned implementation of the strategy to reduce exposure to NPLs and will be accompanied by other complementary measures to reduce exposure,’ the bank said.

Novobanco is selling a NPL portfolio worth EUR 250 million.

Santander Totta has a large single-name portfolio on the market called Summer, worth EUR 160 million. According to a source, the bank is likely to abandon this transaction.

Banco Montepio has also launched Projeto Sado, a portfolio of unsecured NPL worth EUR 68 million.

With smaller portfolios, BCP and Bankinter/Universo were put up for sale.

The NPL ratio in the national system fell from a high of 17.5 per cent in 2015 to less than 3 per cent at the end of June. But there were still EUR 8.5 billion in NPL, according to the latest figures from the banking regulator.

Original Story: ECO | Author: Alberto Teixeira
Edition and translation: Prime Yield

The State’s bank CEO, Paulo Macedo, has revealed that Caixa Geral de Depósitos (CGD) is going to put a new portfolio of unsecured non-performing loans (NPL), totalling a nominal value of 440 million euros, up for sale.

Despite its low NPL ratios, Caixa Geral de Depósitos is still going to clean up its balance sheet. The bank will put a portfolio of Non-Performing Loans (NPL) worth 440 million euros on the market this quarter, revealed Paulo Macedo, at the presentation of the quarterly results.

It already has a name. It’s the ‘Moon portfolio’, and it’s made up of old loans, known as granular, without guarantees (unsecured).

At the end of September, the consolidated NPL ratio was 1.59%, down from 1.65% in December

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

The bank led by Mark Bourke continues to sweep the corners of the balance sheet before going ahead with the sale. It has placed on the market a portfolio of unsecured loans worth 300 million euros.

With strides towards sale, Novobanco continues its efforts to clean up its balance sheet. In the last few weeks it has put up for sale a portfolio of bad debts with a book value of 300 million euros, according to information gathered by ECO. Other banks such as Santander, BCP and Crédit Agricole are also on the market with operations totaling 400 million euros.

In the case of the bank led by Mark Bourke, the portfolio in question is made up of so-called “unsecured” loans; loan contracts without associated guarantees, which should remove some investor appetite for this so-called “Pegasus” portfolio. Interested parties had to express their interest by the beginning of this month. The process is continuing and the bank expects completion by the end of the year, according to what it announced to the market.

This effort to clean up the balance sheet is not unrelated to the plans that the bank (Lone Star, which holds 75% of the capital) has for the near future.

At the moment, Novobanco and the Resolution Fund are negotiating an early end to the contingent capital mechanism, which was created in 2017 when the bank was sold to the American fund and which will only end at the end of next year, in a move that will open the door to dividends and sales, something that is expected to happen in the first half of next year.

As ECO reported at first hand, the Ministry of Finance already has a version of the contract to put an end to the agreement, which will mean that the bank and the fund already have a basis for understanding. For Minister Joaquim Miranda Sarmento, there is even a great incentive to endorse the early termination of the mechanism:dividends of 250 million euros to the public coffers, which should result from the release of a thousand million euros of excess capital that Novobanco has accumulated over the last four years.

With the end of the dividendban, It is true that the major effort took place from the moment it was sold to Lone Star, taking advantage of the guarantee of loss coverage that the contingent capital mechanism provided between 2018 and 2021, having injected around 3.4 billion euros into the bank.Since 2016 until June, this effort has resulted in a reduction in the NPL (non-performing loans) ratio from 33.6% to 4.1%.

Even so, Novobanco still had 1 billion euros in non-performing loans on its balance sheet at the end of the first half.

A hectic end to the year in banking

The non-performing loans market is going through a hangover period after the massive sales of large portfolios (starting with Novobanco) in recent years.

But the last few months of the year brought some excitement with several banks active on the market. BCP has just sold the Spring Project, worth 265 million euros, with loans from Inapa and the promoter of the Algarve Autodrome, and has now put the Lyra Project up for sale, worth 90 million euros.

As the ECO also reported, the Crédit Agricole is also in the process of selling off a portfolio worth 93 million euros, mainly to small and medium-sized enterprises (SMEs).

Santander Totta (140 million euros), Bankinter (30 million euros) and Banco Montepio (amount not yet determined) are also in the market, according to various sources obtained by the ECO.

Santander Totta (140 million euros), Bankinter (30 million euros) and Banco Montepio (amount not yet determined) are also in the market, according to various sources obtained by the ECO.

Original Story: ECO | Author: Alberto Teixeira
Edition and translation: Prime Yield

The market for the sale of non-performing loans by banks is accelerating. Santander has just put up for sale an NPL portfolio worth 160 million euros, made up of loans to large debtors.

Banco Santander Portugal has just put up for sale a portfolio of non-performing loans (NPLs) worth 160 million euros, the majority of which is made up of loans to large debtors (single names).

This NPL portfolio is mixed, between secured and unsecured, but the largest positions are loans with guarantees, Económico understands.

The bank declined to comment.

The market for banks to sell non-performing loans is accelerating at a time when the government says it has a legislative proposal to transpose the directive on credit managers and purchasers, with the aim of ensuring consumer protection. This is a European requirement.

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

Crédito Agrícola has just put up for sale a portfolio of non-performing loans (NPL) worth €93 million, the majority of which belong to small and medium-sized enterprises (SMEs), according to information gathered by ECO from market sources.

The sale includes a stake of secured operations, i.e. contracts with guarantees, 65 per cent of which correspond to NPL for SMEs, according to the same sources.

An official bank source confirmed that the ongoing market consultation process, which is expected to be completed in 2024, is part of the planned implementation of the strategy to reduce exposure to NPLs.

The group led by Licínio Pina has seen its assets decline recently due to high interest rates. In June, the NPL ratio reached 6.5%, up 0.3% from last year. This is more than double the national average of below 3%.

This was an increase of €36.4 million to 765.3 million, with over half (410.5 million) corresponding to SME NPLs. The portfolio on the market represents approximately 12 per cent of the NPL stock. By the end of June, the total amount of money set aside to cover NPLs was 293.3 million. This meant that 38.3% of NPLs were covered.

Original Story: ECO | Author: Alberto Teixeira
Edition and translation: Prime Yield

The Balbec – LX Partners consortium, the UK fund LCM Partners and Arrow Global are the three candidates selected by BCP to submit binding offers for the purchase of a €90 million portfolio of non-performing loans (NPL) from the bank headed by Miguel Maya.

The so-called ‘Swift project’, which consists of unsecured NPLs, will receive binding offers on 18 September, according to Jornal Económico.

Earlier this year, BCP sold a €265m portfolio of single names, or loans from major clients in default, known as the Spring project, which our sources say was bought by Arrow Global.

The Balbec – LX Partners consortium, the UK fund LCM Partners and Arrow Global, who are in pole position to buy the Swift project, are the same candidates to buy a portfolio of non-performing loans from the KKR fund, called the Nata project, which consists of the resale of a portfolio bought by Novobanco in 2018, made up of NPLs with guarantees (secured), and whose binding proposals must be submitted on 2 October.

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

Alternative asset manager Balbec Capital Management has bought a portfolio worth over €4 billion of soured Portuguese loans from Luxembourg-based LX Partners, according to a statement seen by Bloomberg News.

The portfolio has more than 300,000 restructured and non-performing loans (NPL), and its purchase is one of the largest such loan transactions in recent years, Balbec said. It’s one of the biggest portfolio purchases of NPL for the firm since it was founded in 2010.

About two-thirds of the portfolio consists of unsecured debt, such as loans to small and medium-sized businesses, according to Balbec. The secured portion, which is one-third of the portfolio, consists of residential mortgages and other real estate loans.

Balbec has expertise with “credit-intensive” assets such as NPL, one of the reasons why this portfolio is an attractive purchase, the firm said in a statement. The company is re-entering the Portuguese market with this deal.

There may also be an opening to buy these types of loans now. Other lenders that focus on such loans have lately been preoccupied with refinancing their own maturing corporate debt or are looking for opportunities outside Portugal, the firm said.

“Portugal looks particularly attractive to us now because there’s an ample supply of non-performing and semi-performing loans and less competition on the demand side,” Balbec said in a statement.

Many of the loans were originally made by banks and other lenders before later being sold to LX Partners, which invests in a variety of assets, including performing and non-performing assets.

Going forward, Balbec and LX will jointly work on bids for secured, unsecured and mixed portfolios, with LX providing the servicing, according to Balbec.

Original Story: Bloomberg | Author: Scott Carpenter
Edition: Prime Yield

It corresponds to the bank’s unsecured financing in Portugal.

Abanca has gone to the market to sell a 75 million euro portfolio of non-performing loans (NPLs).

The loans are based in Portugal and are unsecured, according to Bloomberg, which reported the news. They correspond to loans granted by Abanca in Portugal, one of its target markets.

Last November the bank, controlled by the Venezuelan Juan Carlos Escotet, decided to buy the Portuguese EuroBic in order to expand its presence in Portugal. This acquisition multiplies Abanca’s number of customers by four and its business volume by three.

At the end of March 2024, the latest data available, Abanca’s balance sheet stood at 74,815 million euros. Its NPL ratio was 2.5%, equivalent to a total of 1,133 million euros. At the end of 2023, the coverage of doubtful assets reached 73.9%, i.e. 1,130 million euros, with provisions of 834 million euros.

Original Story: Expansión
Edition and translation: Prime Yield