Securitization

The secondary loan market is expected to grow in 2021 and rise far above the 100-billion-euro level, while the new securitizations already announced are set to top €20 billion, the Association of Loan and Credit Claims Management Companies (EEDADP) stated on Thursday, on the occasion of its second birthday.

Piraeus Bank has applied to the Hercules asset protection scheme that aims to reduce banks' exposure to nonperforming loans through their securitization.

The application concerns the securitization of Phoenix, a €1.9 billion portfolio of housing loans.

Piraeus' application leaves National Bank as the last of the "big four" Greek retail banks that has not applied to the scheme.

Greek banks are beginning the securitization of their bad loans planned for 2020 amid increased uncertainty related to the duration of the economic crisis and its impact on nonperforming credit portfolios.

Loan managers are reporting an improvement in repayments in May, after the debt servicing delays recorded in the second half of March and the whole month of April. The restoration of payment flows signals a gradual return to normality, said Anastasios Panoussis, chief executive officer at Eurobank FPS and head of the Association of Loan Managers, at SmithNovak's European conference.

Piraeus Bank is launching the process for its first bad-loan portfolio securitization, opening the virtual data rooms to candidate investors in the Phoenix package within March.

The government is working on measures to accelerate the court hearings of borrowers who have found protection from confiscations under the so-called Katseli law; it is also forming its new bankruptcy code, whose central idea will be "pay up what you owe or go under."

Alpha Bank's management has designed a strategy to reduce nonperforming loans and transform the group so that it can "turn the page," the lender's CEO Vassilis Psaltis tells Kathimerini, stressing that the Greek economy is on a steady growth path and that the international investment community is regaining faith in the country's prospects.

Eurobank subsidiary FPS is set to evolve into one of the biggest companies in its domain in Greece - with a role in the broader market of Southeastern Europe too - now that Italy's doValue, a member of the Fortress Group, has secured an 80 percent stake in the bad-loan management firm.

The management at Alpha Bank is targeting the full restoration of the lender's profits and has drafted a strategic plan aimed at streamlining its financial figures through the securitization of bad loans worth up to 12 billion euros.

Alpha Bank on Tuesday reported lower third-quarter profits after higher bad-debt provisions and said it would launch a big securitization of soured loans to clean up its balance sheet.