Reaching a final agreement with a consortium consisting of subsidiaries of the investment companies Bain Capital Credit and Fortress Investment Group as well as doValue Greece for the sale of 95% bonds of medium (Mezzanine) and low (Junior) repayment priority in the context of securitization of non-foreign exchange portfolio of a total book value ~ € 6bn, was announced by the National Bank.
The NBG will hold 100% of the senior repayment priority bonds, for the guarantee of which a request for has been submitted by the Greek State pursuant to the provisions of Law 4649/2019 on the Guarantee Program for securitization of credit institutions ” Iraklis “, as well as 5% of the bonds of medium (Mezzanine) and low (Junior) repayment priority. The transaction is carried out in the context of the Bank’s strategy for the management of non-performing exposures and is in line with the objectives, as they have been submitted to the Single Supervisory Mechanism.
Proceeds
The total income for the NBG, which mainly reflects the value of the Senior bonds and the price for the Mezzanine and Junior bonds, amounts to ~ 50% of the total book value of the portfolio. The transaction will strengthen the Bank’s total capital by ~ 150 basis points, with the capital adequacy ratio increasing to 18.5% (pro-forma) in the first half of the year while at the same time the non-performing exposures ratio amounts to 12.7%.
The transaction is expected to be completed within the fourth quarter of the year, subject to the required approvals. After the completion of the transaction, the management company doValue Greece, which has received a license and is supervised by the Bank of Greece under Law 4354/2015 and has many years of experience in managing non-performing loans, will take over the management of the portfolio.
On behalf of the EIB, Morgan Stanley & Co. International plc acts as financial advisor and organizer of the transaction, Oliver Wyman as financial and technical advisor while the law firms Clifford Chance LLP and Karatzas & Associates as assistant legal advisors in English and Greek law respectively.
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