Piraeus Financial Holdings SA (Piraeus) announced today that it has signed final agreements with Intrum AB (publ) and Serengeti Asset Management LP for the sale of forty-nine percent (49%) and two percent (2%) of the intermediate and low repayment priority bonds (mezzanine and junior notes) respectively, of the securitization of Sunrise II (the “Transaction”).
The Sunrise II portfolio includes approximately 47 thousand loans to individuals and companies with a total gross book value of € 2.7 billion, as of December 31, 2020.
The valuation of the Transaction, which is based on the nominal value of the high repayment bonds and the income from the sale of the intermediate and low repayment bonds, corresponds to 47.4% of the total gross book value of the portfolio.
The Transaction is part of the broader strategic plan of Sunrise of Piraeus, announced on March 16, 2021 and follows the successful completion of the securitization of Sunrise I amounting to € 7.2 billion, Piraeus states in a relevant announcement and adds:
It highlights the rapid progress that Piraeus has made in the implementation of the NPE reduction plan by approximately € 19 billion, in order to achieve a single-digit NPE index by the beginning of 2022.
On August 5, 2021, Piraeus Bank submitted an application for inclusion of Sunrise II high repayment priority bonds in the Greek Guarantee Program. The application concerns the provision of a guarantee by the Greek State on high repayment priority bonds amounting to € 1.2 billion.
The Transaction will be classified as ‘held for sale’ on September 30, 2021, with the result that the index of non-performing exposures of Piraeus will decrease to about 17% based on 2nd quarter data 2021, from 45% on December 31, 2020 and 23% on June 30, 2021 Subject to obtaining the required approvals, Piraeus expects the non-performing loans of Sunrise II securitization to be derecognised from its consolidated financial position within the 4th quarter of 2021.
The expected capital impact from the Transaction is approximately 1 percentage point on the total capital adequacy ratio of June 30, 2021, including the impact on the result and the corresponding relief on risk-weighted assets.
Piraeus Bank will hold five percent (5%) of Sunrise II intermediate and low repayment priority bonds, in accordance with the securitization supervisory framework. In addition, Piraeus Bank will hold high repayment bonds in their entirety.
The Transaction is subject to the usual approvals by the competent Greek authorities, as well as to the consent of the Financial Stability Fund.
Goldman Sachs Bank Europe SE and Alantra CPAI Limited act as organizers and financial advisors of Piraeus in the Transaction.
The law firms Paul Hastings (Europe) LLP and Moratis-Passas act as legal advisors of Piraeus and the organizers of the Transaction.
Source From: Capital