Project Pillar

Jun 2019

Arranger – Securitisation - Secured NPL

Value €2 billion

Acting as Arranger to the deal, Alantra, a leading global investment bank and asset management firm, is pleased to announce its client, Eurobank Ergasias S.A. (“Eurobank”), has completed the Greek market’s first public securitisation of NPL exposures.

Issued notes totalling €2bn are secured by Greek non-performing mortgage loans at varying stages of restructuring and enforcement processes. Significant credibility is given to the servicer, Eurobank Financial Planning Services S.A’s (“FPS”) long-standing track record and local market knowledge; FPS’ business plan indicates collections comfortably above the levels required by the ratings review. A detailed workout strategy is bolstered by the location and mix of collateral backing the underlying exposures. Greece’s two largest cities of Athens and Thessaloniki dominate, and provide a strong backdrop as they lead the country’s real-estate market recovery.

As part of the transaction, Eurobank agreed to sell subordinated notes to a unit of U.S. funds group Pimco. The deal strengthens Eurobank’s position in the Greek banking sector through further reductions the bank’s NPE ratio, which is already the lowest amongst regional peers. Continuing their NPE reduction plan, Eurobank shall soon complete a follow-up transaction, Project Cairo, which comprises a further securitisation of over €7bn of multi-asset-class exposures. This second sale, along with disposal of the bank’s servicing unit, FPS, are set to close by year end.

With an NPE pipeline currently sat at over €27bn across the Greek banking sector, Italian GACS-style guarantee scheme on the horizon, rising real-estate values, and re-worked borrower protection laws, the market is primed for an active year ahead.