MILAN, Oct 7 (Reuters) - Illimity is evaluating
potential bids on 2 billion euros ($2.4 billion) of impaired
bank loans, a senior executive at the Italian bank said, as
disposals resume after the hiatus caused by the coronavirus
Italy's 340 billion euro market for problem loans is
Europe's biggest. After more than halving soured debts on their
balance sheets in recent years to tackle the legacy of the
previous slump, Italian banks are now bracing for an expected
wave of defaults caused by COVID-19.
Market activity froze at the height of the healthcare
emergency. It is now picking up, though foreign investors are
sitting on the fence as they consider higher future risk because
of a worsening macroeconomic outlook and slower recoveries.
"When it comes to the impact of the pandemic, we're simply
seeing more caution on the part of international buyers ...
they're offering slightly lower prices for loan portfolios,"
Illimity's head of distressed credit investments, Andrea Clamer,
told Reuters on the sidelines of a conference on Wednesday.
"There are fewer international bidders at tenders, but Italy
has a fairly good number of domestic players. We're currently
assessing a series of loan portfolios with a gross book value of
2 billion euros."
Illimity, the digital bank and bad loan specialist founded
by veteran Italian manager Corrado Passera, has acquired about 6
billion euros in impaired bank loans since starting operations
Loans Illimity is looking at are in default or unlikely to
be repaid in full, with a portfolio size that varies between 0.5
billion and 1 billion euros, Clamer said.
Illimity specialises in corporate loans.
Clamer said support measures the government had introduced
for borrowers, such as debt holidays, applied only to those with
performing loans and prompted some clients to settle
non-performing debt to tap the aid schemes.
($1 = 0.8493 euros)
(Reporting by Valentina Za
Editing by David Goodman)