Piraeus Bank agrees to sell bad loan notes to Intrum, Serengeti

Credit: REUTERS/STRINGER

Piraeus Bank said on Tuesday it reached definitive agreements with loan servicer Intrum and asset manager Serengeti to sell 49% and 2% of the mezzanine and junior notes in its Sunrise I securitised portfolio of impaired loans.

ATHENS, June 15 (Reuters) - Piraeus Bank BOPr.AT said on Tuesday it reached definitive agreements with loan servicer Intrum and asset manager Serengeti to sell 49% and 2% of the mezzanine and junior notes in its Sunrise I securitised portfolio of impaired loans.

The Sunrise I portfolio includes retail and corporate non-performing exposures (NPEs).

"The implied valuation of the transaction, based on the nominal value of senior notes and the sale price of the mezzanine and junior notes corresponds to about 34% of gross book value," Piraeus Bank said.

The Sunrise I portfolio's gross book value stood at about 7.2 billion euros ($8.73 billion) at the end of September last year.

The sale is part of Piraeus Bank's 19 billion euro NPE clean-up plan which aims to drive its NPE ratio to single digits in the next 12 months.

Piraeus Bank said it has applied to include the Sunrise I senior notes in the government's Hercules bad loan reduction scheme, which will provide a state guarantee on the senior notes amounting to about 2.45 billion euros.

"The expected capital impact of the transaction stands at about 2.7 percentage points over the December 2020 total capital ratio," the bank said.

UBS Europe and Alantra acted as arrangers and financial advisers to Piraeus Bank.

($1 = 0.8247 euros)

(Reporting by George Georgiopoulos; editing by Jason Neely)

((george.georgiopoulos@thomsonreuters.com; +30210 337 6437; Reuters Messaging: george.georgiopoulos.thomsonreuters.com@reuters.net))

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