Novobanco continues NPL clearance

Novobanco tried to sell a €121 million debt contracted by civil construction builder José Guilherme at a 97% discount.

According to the newspaper Correio da Manhã, the Resolution Fund refused to sanction or cover the operation in case the builder then tried to buy back the debt for a ridiculously low sum.
If the operation had not been turned down, the debt could have been sold for €3.9 million to an international fund, which would have been at just 3% of the debt’s total value (without impairments).
The builder’s debt was initially included in the NPL portfolio Harvey which Novobanco went on to sell to Deva and Arrow for a third of its value (discount of 70%) last week.
Novobanco sold Project Harvey (which contains big ticket debts worth a gross value of €164 million) for €52.3 million which amounts to a discount of around 70%. With the sale of this NPL portfolio, Novobanco ended 2021 with a NPL ratio of 5%.