NB to sell Grupo Lena and Urbanos debts
Project Harvey, the name Novo Banco has given to a portfolio of bad loans or NPLs worth €640 million, will include the debts from the construction company Grupo Lena and removals and logistics company Urbanos.
Urbanos was founded by removals mogul Alfredo Casimiro who has been forced to relinquish his 51% controlling share in the baggage handling company Groundforce which will be auctioned by the bank Montepio.
The CEO of Novo Banco, António Ramalho has informed that “Novo Banco, in line with other banks in the market, is making the most of an opportunity and market appetite for the purchase of this type of NPL”.
Other banks such as state-owned Caixa Geral de Depósitos (CGD), Santander Totta and BCP also have debt portfolios on the market.
Moreover, Novo Banco has an impairment ratio above 7%, despite efforts in recent years to clear NPLs inherited from the fall of Banco Espírito Santo (BES) off its books. The ratio of NPLs, mostly derived from BES, still accounts for 33%.
Novo Banco will have to continue to reduce its exposure from sour loans until it achieves a ratio of 5% in line with European Central Bank regulations.
After years of losses, caused in part by the BES bad loans, Novo Banco now seeks to turn the page towards sustained profits from this year onwards.
Its results for Q1 of 2021 were €70 million in profit and it expected to equal or even exceed this amount for H1.
The Lena group, owned by the Barroca Rodrigues family, is the largest debtor in the Harvey portfolio with a default of €180 million.
Urbanos owed Novo Banco toxic debts of around €9 million which are also in the Harvey portfolio.