UniCredit prepares to offload €6b NPL portfolio

Italian global banking firm UniCredit is preparing to sell a portfolio of non-performing loans (NPLs) with a nominal value of €6 bn, just weeks after it unveiled its latest business plan.

The loan portfolio, dubbed project Prisma, includes both secured and unsecured loans granted to private individuals. Germany-based ratings agency Scope Ratings revealed that the sale was on the cards, after it said it a report that it had released a BBB+ rating for the loan tranches.

The deal would mark the second most significant NPL sell-off executed by UniCredit, following the €17.7 bn deal struck with Fortress and Pimco for project Fino in 2017. That transaction was the largest ever recorded in Italy at the time, later beaten by Banca Monte dei Paschi di Siena's securitization of €24.1bn of NPLs in May 2018.

According to UniCredit CEO Jean Pierre Mustier, the disposal of NPLs was one of the cornerstones of its 'Transform 2019' business plan, with which the bank plotted its 2016-2019 strategy.

Italy's lively NPL market has been growing year on year, driven by private jumbo deals and securitizations backed by GACS, the state-sponsored guarantee mechanism. In 2018, it was Europe's most active NPL market, registering €103.6 bn of gross bond value sales, according to Debtwire. In second place, Spain recorded just €43.2 bn of NPL disposals.

Unicredit's strategy to further streamline its assets was underlined this week when news broke of plans to sell its Tucherpark campus in Munich for more than €1 bn.


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