Alantra advises Piraeus Bank on three Greek synthetic STS securitisations

Jul 2022

Securitisation – Sole arranger and financial advisor

Value €2.7 billion

Athens – Acting as sole arranger and financial advisor on all three deals, Alantra, a leading global investment bank and asset management firm, is pleased to announce that its client, Piraeus Bank S.A. (“Piraeus”) has entered into binding agreements for three synthetic securitisations of performing loans in Greece, comprising mortgage, corporate/SME, and other exposures, with a total aggregate Gross Book Value (“GBV”) of € 2.7bn.  

The structure of the corporate/SME transaction follows the mandate of the European Guarantee Fund and is distinct from previous synthetic transactions executed by Piraeus, as it provides first loss protection without the need for a Special Purpose Vehicle (“SPV”) or collateral. In more detail, the EIB Group will provide protection to Piraeus for a First Loss Tranche in exchange for the guarantee fee. The Bank has committed to originate new loans to eligible SMEs over the next 18 months with reduced interest rates and will benefit from a discount in the guarantee fee (retrocession) in return.  

For the mortgage transaction, Piraeus Bank will enter to a financial guarantee with an SPV acting as the Protection Seller. The Protection Seller issued notes to two investors and used the proceeds to purchase eligible collateral to secure its obligations under the guarantee and the notes. The first loss and senior tranche of the transaction will be retained by Piraeus.  

The mortgage deal is a landmark transaction for Piraeus, Alantra and Greece as it is the first synthetic securitisation of mortgage exposures in the country.  

All three transactions meet the criteria of synthetic STS securitisations set out in Articles 26b to 26e of EU Regulation 2017/2402 as amended by EU Regulation 2021/557. 

Subject to regulatory approval that the transactions transfer significant risk (“SRT”) the transactions will lead to a reduction of RWEAs of c. €1.1bn. 

These transactions mark a significant milestone for our client and the Greek securitisation market and further cement Alantra’s role as Piraeus’ trusted advisor for capital relief transactions. 

Holger Beyer, Managing Director at Alantra, stated: “Following these transactions Piraeus Bank has completed five SRT transactions in a period of 14 months demonstrating the ability of synthetic securitisation to provide risk protection and capital relief in a reliable manner, even in difficult market conditions. We are grateful for the confidence Piraeus has in us to advise it on these strategically important transactions.”