Eurobank on Thursday announced it has entered into an agreement with Intrum, to sell a non-performing loan portfolio of total unpaid principal 1.5 billion euros of which 620 million on balance sheet.
The portfolio consists of unsecured consumer loans, the bank said in an announcement, adding that the servicing of the portfolio will remain with Financial Planning Services (FPS), which is the 100 pct owned by Eurobank licensed NPL servicer. Intrum has the flexibility to find alternative servicing capacity in the future. The investment will be financed by Intrum’s available cash and credit facilities. The transaction is part of Eurobank’s 2017 NPE plan reduction and will close within the fourth quarter of 2017.
The consideration is 3 pct in terms of total unpaid principal and will be P&L and capital neutral.
“Eurobank committed towards its regulators and shareholders to derisk its balance sheet by actively managing and reducing its NPL book, is proceeding with a significant sale of consumer unsecured NPLs to Intrum. We are happy to conclude this transaction with the largest European Credit Management Services provider who is well known and reputable for its servicing practices”, said Fokion Karavias, CEO of Eurobank.
“This investment is strategically important for Intrum, positioning us as a strong partner for Greek banks which have significant non-performing loans to address. We believe that the Greek economy as well as opportunities in the Greek credit management industry will open up significant room for continued growth of Intrum’s market leading presence in Europe during the coming years” said Mikael Ericson, President & CEO of Intrum.