#Savethedate 13°CV Day

After the positive experience of 2018 CV Fintech day this year digital innovation applied to Credit Management and NPL market will be back on stage at the 13°CV Day on 20th November during the afternoon session.

Check the full agenda of the day 

Special Free Pass for the afternoon Fintech Session can be requested writing to c.riefoli@creditvillage.it

Full access at the whole event can be purchased at this link

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#SaveTheDate IMN’s 4th Annual Investors’ Conference on Italian & European NPLs

IMN’s 4th Annual Investors’ Conference on Italian & European NPLs will return to Milan, Italy on 13 November 2019 to address the latest updates in the non-performing loan market.

Link to event page

The conference will bring together leading representatives from major banks, private funds, law firms, rating agencies, service providers and more to discuss the industry’s pressing topics, including Overview of Italy’s Banking Sector, Overview of Key Government Efforts to Stabilise the Italian Banking Sector, Application to Other Mediterranean Economies: Implications for Spain, Portugal and Beyond.

Confirmed speakers can be found at this link

Keynote speech will be held by:

This year I am goingo to moderate the panel The Broader Investor Base: What to Expect as a New Entrant

Link to the full Agenda of the event

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Posted in Entering Italian NPL Market, Events, Italian Banks, NPL e Distressed Assets | Tagged , , , | 2 Comments

Italian banks and NPL Update 2019-09

Concentration through M&A seem to be a relevant trend among NPL investors and special servicers in Italy:

  • Credito Fondiario and Banca IFIS decided not to continue their exclusive negotiation to form a new platform with som 45m of Asset Under Management +additional 25m as Master Servicer
  • Intrum is said to be close to acquire Credit Management operations od Cerved Group that could be worth some 400m applying the same EV/Ebitda ratio of doValue.

Relevant transactions are also expected with

  • Unicredit selling 6 Bn (Project Prisma) of NPL -the porfolio includes a mix of secured and unsecured retail loans + a UTP portfolio with some 1 Bn
  • MPS that could be selling NPLs for 10bn in order to accelerate the balance sheet cleanup needed to make the bank appealing for potential buyers

Meanwhile the stock of Non Performing Exposures is close to a 10 year minimum as reported by NPL Market Watch issued by Banca IFIS

Reduction is quite remarkable also in broad European perspective

So far the outstanding NPL portfolios appear to be skewed towards corporate and secured loans

2019 Pipeline remain quite consistent

Even though 78% of AUM are concentrated in the top 10 special servicers a further consolidation process is expected that could potentially lead to a landscape with top 3 players covering some 60-65% of the market

GACS Scheme is expected to remain a key driver in the process reduction of NPL on Italian banks’ balance sheet while non GACs securitization schemes will be likely used to dispose UTPs

Savethedate IMN’s 4th Annual Investors’ Conference on Italian & European NPLs will return to Milan, Italy on 13 November 2019 to address the latest updates in the non-performing loan market.

Savethedate 13th CV Day will take place at Crowne Plaza Milan Linate on 20th November

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Posted in Entering Italian NPL Market, Italian Banks | Tagged , , , , , , | 1 Comment

Italian banks and NPL Update 2019-09

SGA the Italian state owned asset management company focused on NPLs and UTPs has changed its name in AMCO and presented positive results for first half 2019 with 20.6 Bn € of assets under management and 8.2m € net profit for half year.

The substantial decrease of NPL stock in Italian banks’ balance sheets has been achieved mostly using GACS securitization schemes and Originator – Investor long term partnerships or Joint Ventures both producing a substantial boost for servicing industry.

Increased volumes is one of the most relevant driver of consolidation process in special servicing industry with Credito Fondiario Fonspa and Banca IFIS studying a partnership in the debt servicing and Cerved considering the spin off of its Credit Servicing Unit.

The final landscape we can expect to see will be therefore likely to have a reduced number of large players that will probably cover some 2/3 of the entire market with smaller players dedicated to remaining market share and active ad a sub servicing level.

Savethedate on September 26th I am going to present a workshop at Banca IFIS‘ NPL Meeting

I will also be speaking at the NPL Investing & Servicing Summit | Athens October 17-18 in the New Developments & Opportunities Panel.

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Posted in Entering Italian NPL Market, Italian Banks, NPL e Distressed Assets | 1 Comment

#SavetheDate NPL Meeting 2019

Savethedate on September 26th I am going to present a workshop at Banca IFIS‘ NPL Meeting

The NPL Meeting workshops represent a unique opportunity to analyze the dynamics of the NPL world and to discuss what the future of deteriorated credit will hold for us.

Workshops will take place in two highly prestigious locations on Venice Lido: the Excelsior Hotel and the Palazzo del Cinema. A clear and well-defined format: September 26 will be entirely dedicated to workshops, moments of reflection lasting an hour and distributed across three time slots. Between one time slot and another, participants will have 15 minutes to move between the two hosting structures, which are adjacent to one other.

The topic I am going to cover is

The workshop will take place in 2 time slots 2:30 PM – 3:30 PM and 5:00 PM – 6:00

In order to attend the workshop you need to register to the main event at this link 

Then you will be allowed to access the workshop page where you can book by clicking on the appropriate button as showed below.



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Posted in Events, Italian Banks, NPL e Distressed Assets | Tagged , , , | 2 Comments

A Short reminder for next Government

Italian Politics these days looks quite difficult to understand (but I tried to offer a naïve model to read it in this post) and it is hard to say even why the crisis has started and which colors will have the next Government.

A very short and useful explanation has been provided by a friend of mine, professor Sandro Brusco of Stony Brook University :

(…) The bottom line: Italy had a long period of government instability mainly because of its proportional system. The system was (partially) changed in 1994 but it never was entirely majoritarian. After a number of reforms and pronouncement from the Supreme Court the system went back to being essentially proportional in the last election. Thus, in terms of government duration, we are back to the period 1948-1994, the proportional period, in which governments lasted between 12 and 18 months. This government was installed in June 2018, so it basically reached maturity. From that point of view, things are actually quite boring. (…)

Read the full post

Rather than looking pointless explanation of present, it is much easier to foresee behavior of upcoming government: it will make a deal with EU trading 1) additional budget flexibility for 2) commitment to make future reforms.

Why such a deal? Because it will lower present burden on taxpayers, it will reduce the bad taste of poisoned pill budget law and given the potential risks arising from US-China trade war and global recession, EU will be happy to pretend to believe that someday reforms will come.

If near future is written and present politics conundrum is pointless to explain what else can be said?

Below 3 short reminders for government to come:

  1. Italy’s problem 1 is demography and current pension system is unsustainable – excess burden on young people provides an incentive for those with best education and the strongest risk appetite to leave the country worsening the situation       
  2. Italy’s problem 2 is competitiveness – open new business and keep existing ones alive is more difficult days after day and so many actual and potential entrepreneurs start thinking tha change country is easier than wait that this country changes   
  3. Italy’s problem 3 is growth – the more the country grows old and becomes less competitive the less likely it will show a significant economic growth – a wide interference of state in economy and a dysfunctional welfare system are additional ingredients for long lasting stagnation

Has anyone heard about these problems in politicians’ words or on main Italian newspapers? Not really, with some remarkable exceptions.

Bottom line 3 short suggestions for next government could be

  1. Try to shift part of current burden from young ones to old ones
  2. Try support policies that enhances competitiveness of the country (es Shift burden from less risk adverse people to those who are more risk adverse)
  3. Try to focus more on how to enlarge the pie of potential wealth rather than how to divide the existing one

Post Scriptum

Why send a letter in English to Italian Government? Maybe the true recipient of the letter is not the Government.

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Posted in Italian Politics, Unconvenient Ideas | Tagged , , , , , | 1 Comment

Is servicing still the main Challenge of NPE Market?

Unlikely To Pay (UTP) exposures seem to be the hotspot of italian NPE market with upcoming deals worth more than 20Bn of Gross Book Value

Intesa Sanpaolo has recently reached a binding agreement with Prelios to form a strategic partnership in respect of loans classified as unlikely to pay (UTP).

The agreement consists of a 10-year contract for the servicing of UTP Corporate and SME loans of the Intesa Sanpaolo Group to be provided by Prelios initially covering a portfolio worth around €6.7 billion of gross book value, and the disposal and securitisation of a portfolio of UTP Corporate and SME loans of the Intesa Sanpaolo Group worth around €3 billion of gross book value, at a price of around €2 billion which is in line with the carrying value.

SGA, the credit management firm fully owned by Italian Ministry of Economics and Finance, is about to launch the Covee project an investment fund focused on real estate backed UTPs that will involve banks like BancoBpm, Mps, Ubi Banca, and Carige and will be run in partnership with Prelios.

As far as we know, the banks will basically trade the ownership of UTPs with shares of the fund and, since none of them will have the majority of the shares, they will be able to offload the NPEs from balance sheets.

New GACs scheme as explained by KPMG and PWC recent reports, is likely to be a relevant driver for a new wave of NPL deals in future months as the tack record of this tool points out. After GACS introduction, 21 transactions were completed between 2016 and 2019 for a total GBV of € 62.1 bn; 9 deals on total number of transactions had a deal size ranging from € 1 to 5bn. Around 60% of securitized loans are backed by mortgages on real estates properties.

Source: GACS tool in the Italian Non-Performing Loans space

Main differences between “old” and “new” Gacs scheme have been summarized in PWC report

Finally we can consider that securitization schemes with the support of GACs for NPL and a large use of outsourcing for UTPs (with some “share the risk to derecognize” framework to come) are quite addressing the NPE reduction problem of Italian banks.

Once claims have been transferred to SPV the challenge remains to properly manage them in order to collect money in line with committed business plan and this will be the focus of following posts (hopefully after August).

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Are you interested in Italian banks and NPL/UTP market? Ask for a briefing  (in person or via conference call) by sending me a private message. I am also available for consulting projects on Distressed Assets pricing and Portfolio Management.

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GLG – Gerson Lehrman Group – Council Member



Posted in Entering Italian NPL Market, Italian Banks, NPL e Distressed Assets | Tagged , , , , | 2 Comments