Italy's UniCredit SpA is selling a portfolio of nonperforming home mortgages worth €5 billion and is set to make an announcement related to the transaction in November, Reuters reported, citing two sources familiar with the matter.
Italian debt-servicing company doValue SpA will manage the portfolio, one of the sources told the newswire.
Italian banks have historically been averse to selling off nonperforming home mortgages because it could result in bad publicity when loan collectors foreclose on properties to try and recover the money owed. However, there are not many options left to lenders considering the regulatory and market pressure on having cleaner balance sheets, the report said.
According to the report, the lender is expediting its efforts to clean up its balance sheets before Dec. 3, when it will present its new business plan. In August, UniCredit lowered its year-end target for gross problem loans at its noncore division to roughly €10 billion from €14.9 billion and its head of noncore management has confirmed that the Italian lender is on track to meet its goals.
The bank has off-loaded multiple portfolios of soured debt since June to the tune of roughly €2.3 billion. The lender is also gauging interest from potential buyers for a portfolio of up to €1 billion in unlikely-to-pay small-ticket corporate loans and is seeking nonbinding bids.
