Deleveraging Europe 2015 - 2016
Download the Greek press release here
Headline numbers
<div class="custom-rte"> <p></p><p></p><p></p><p></p><ul> <li>2015 completed sales were €104.3bn, up 26% from 2014's total of €83bn in sales of European non-performing loans (NPLs) and non-core assets (NCAs)</li> </ul> <ul> <li>Loan portfolio market total sales are expected to reach €130bn in 2016</li> </ul> <ul> <li>European financial institutions are expected to continue to deleverage as they tackle over €2tr of non-core and non-performing assets</li> </ul> <p></p> <p> </p> <p></p> <p></p> <p></p> <p></p><p></p><p></p><p> </p> <p></p> <p></p> <p></p> <!--language div end--> </div>
Key highlights in this edition
<div class="custom-rte"> <ul> <li>We are starting to see a sustained shift away from portfolios of non-performing commercial real estate loans towards performing, non-strategic residential and SME loan sales</li> </ul> <ul> <li>The UK was the most active country in terms of loan sales in 2015 with sales exceeding £38bn, the distressed market in the UK is quickly being replaced by significant volumes of performing loan products and we expect the UK to continue to top the country tables in 2016</li> </ul> <ul> <li>The Irish loan sale market is showing signs of slowing down with activity shifting to Italy, Spain CEE and SEE</li> </ul> <!--language div end--> </div>
Opens in new window
Themes influencing NPL transactions
- Improving investor confidence and regulatory reforms will help pave the way for increased NPL activity in 2016
- Ongoing retrenchments to home markets and a stricter focus on core businesses and strategic direction are expected to ensure a high level of activity in the portfolio market
- Increased regulations and capital requirements for Banks as a result of Basel III, Solvency II and IFRS9 continue to stimulate divestitures
Non-performing loans are a significant drag on banks overall performance, both financially and operationally. Selling these types of assets becomes a good option to improve capital positions, with banks under increased pressure from regulators and shareholders to clean up their balance sheets. Regulatory changes along with market pressure to improve returns continues to force a further shift in the marketplace with banks also seeking to sell performing, non-strategic loans that don’t fit their return on capital targets. Sophisticated banks are really paring back to core, profitable business lines and either exiting or offloading risk in those areas that don’t deliver their overall strategic objectives and return expectations.
David Edmonds, Global Head of Portfolio Lead Advisory Services at Deloitte
About Deloitte
“Deloitte,” “us,” “we” and “our” refer to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each other. DTTL does not provide services to clients. Please see www.deloitte.com/about to learn more.
Deloitte provides industry-leading audit and assurance, tax and legal, consulting, financial advisory, and risk advisory services to nearly 90% of the Fortune Global 500® and thousands of private companies. Our professionals deliver measurable and lasting results that help reinforce public trust in capital markets, enable clients to transform and thrive, and lead the way toward a stronger economy, a more equitable society and a sustainable world. Building on its 175-plus year history, Deloitte spans more than 150 countries and territories. Learn how Deloitte’s approximately 415,000 people worldwide make an impact that matters at www.deloitte.com.
Press contact(s):
Maria Ziouvelou
Chief Marketing Officer & CSR Leader
Kelly Koufopoulou
Senior Manager
Brand & Communications