Eurobank sells 1,5bn Euro bad loans to hedge fund for just 45 million Euros!

6 October 2017
1035 Views

Eurobank, Greece’s third largest lender, said on Thursday it will sell a 1,5 billion Euro pool of non-performing loans to Swedish hedge fund Intrum, as part of efforts to reduce its load of sour debt and meet targets agreed with regulators.

Greek banks are burdened by soured loans clogging up their balance sheets and holding back lending. The total of so-called non-performing exposures (NPEs) amounted to 101,8 billion Euros at end-June or 50,6% of their total loans.

Banks have agreed with regulators to reduce their NPE mountain by 38% to 66,7 billion Euros by 2019.

“Eurobank committed to derisk its balance sheet by actively managing and reducing its NPL book. We are happy to conclude this transaction with the largest European credit management services provider,” said Eurobank CEO Fokion Karavias.

Eurobank’s deal with Intrum refers to a pool of non-performing unsecured consumer loans of unpaid principal of 1,5 billion Euros, of which about 620 million remains on its balance sheet.

The sale was agreed at a price of about 3% of the face value of the loans and will be capital neutral, the bank said, meaning proceeds will be around 45 million Euros.

Eurobank expects the transaction to close by the fourth quarter.

Under the deal, the servicing of the portfolio will remain with Financial Planning Services (FPS), a wholly-owned Eurobank unit. Intrum can find alternative servicing in the future.

Eurobank’s non-performing loans (NPL) ratio dipped to 34,6% at the end of the second quarter.

You may be interested

The first Aegean Hawk S-70 helicopter was delivered to the Hellenic Navy by Aeroservices
GREECE
shares24 views
GREECE
shares24 views

The first Aegean Hawk S-70 helicopter was delivered to the Hellenic Navy by Aeroservices

Panos - May 07, 2021

The first upgraded Aegean Hawk S-70 helicopter was delivered to the Hellenic Navy today, Thursday 6 May. The work on…

Foreigners looking to buy Greek property amid Covid-19 pandemic
FINANCE
shares39 views
FINANCE
shares39 views

Foreigners looking to buy Greek property amid Covid-19 pandemic

Panos - May 07, 2021

Despite the pandemic, the demand for a permanent holiday home in selected destinations in Greece by foreigners is on the…

Greek Taxisnet services not available for citizens over weekend
FINANCE
shares33 views
FINANCE
shares33 views

Greek Taxisnet services not available for citizens over weekend

Panos - May 07, 2021

Online services on the Taxisnet platform system will not be available to taxpayers over the weekend due to scheduled upgrading.…

Leave a Comment

Your email address will not be published.