By George Georgiopoulos and Pamela Barbaglia

Alpha Bank, Greece's fourth-largest lender, is close to finalising a deal to sell a portfolio of bad loans worth more than 1 billion euros (£902 million) to U.S. investment manager Fortress Group, three sources familiar with the matter told Reuters.

The sale is part of Alpha's efforts to offload bad debt and clean up its balance sheet as Greek banks resume plans to divest non-performing loans after the disruption caused by the coronavirus outbreak.

Alpha was initially looking to wrap up the sale of the portfolio, known as Neptune, in February but final discussions had to be pushed back because of the health emergency.

"They are now close to the finishing line," one of the sources said, asking not to be named.

Alpha and Fortress had no immediate comment.

The Neptune portfolio consists of mid-size corporate loans, which are backed by commercial property collateral, the sources said.

Alpha Bank is also in parallel negotiations with at least five U.S. investment firms including Cerberus and PIMCO in a fresh attempt to get rid of another portfolio of bad debt worth more than 10 billion euros.

That portfolio, known as Galaxy, consists of retail loans worth 7.6 billion euros plus loans to medium-sized and large corporate clients worth 3 billion euros.

Alpha, which is 11% owned by Greece's bank rescue fund HFSF, reported a slight drop in its non-performing loans (NPLs) to 30% of its loanbook at the end of the first quarter from 30.1% in December.

U.S.-based Fortress invests globally, including in undervalued assets and distressed credit. Since 2002 it has invested more than $130 billion across the credit spectrum.

(Reporting by George Georgiopoulos in Athens and Pamela Barbaglia in London; editing by Barbara Lewis)