New movements within the portfolio sector. Intrum has hired the director of toxic assets (NPL secured & REO’s) from Axactor, Marco Bianchi, to continue growing in this segment for 2021, a year in which a rebound in the sale of debt portfolios is expected, as you have learned Vozpópuliby market sources.
Bianchi has made the leap to the Swedish company with the position of ‘Group Portfolio Manager‘and will be in charge of managing alternative assets (NPL secured, REOs y subperforming) for various markets at the European level, including Spain. Bianchi also worked in this same area as director of Copernicus and to Lapithus Management, the ‘servicer’ of Apollo.
Intrum is known in Spain due to its high activity in purchasing portfolios from large banks. In fact, the Swedish fund acquired the largest portfolio of bad debts in BBVA’s history for a value of 2,500 million euros. In 2019, it also bought 80% of Solvia, the servicer of Banco Sabadell, for 241 million euros.
The sector expects that in the 2021 there is a new upturn in the sale and purchase of portfolios of toxic assets due to the coronavirus. Recently, the Banco Sabadell has closed the sale of the ‘Project Explorer’ to the Tilden Park fund, an old acquaintance in the Spanish market who has returned, as has Metric, which according to market sources, is very active in search of opportunities.
Consumer credit problems
Consumer credit begins to give the first alarm signals within Spanish banks. In the second quarter of 2020, doubtful loans related to the most sensitive area of this segment rose to 2,500 million euros, 27% more than in the previous quarter, which means reaching 2011 levels, according to data from the Bank of Spain.
The total credit portfolio linked to durable consumer goods also rose in the same quarter to 59,826 million euros, 2.2% more than in the previous quarter. This increase shows that the increase in doubtful loans is related to the current economic crisis that has caused the coronavirus and not with an eventual growth of the total banking portfolio.
The Bank of Spain has been warning of the risk involved in this type of loan. Above all, due to its upward trend in recent years. The regulator was already calling in the summer financial report for increased monitoring of these loans, as well as greater monitoring of “the most dynamic entities in this segment”.
A loan is considered bad when more than 90 days pass without the borrower paying principal or interest. Bad loans are also known as non-performing loans (NPL).
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