Novo Banco sells portfolio of non-performing loans for €37M

Novo Banco sold a portfolio of non-performing loans and related assets with a gross book value of 79 million euros for 37 million euros, but still had a marginally positive impact on results and the capital ratio because it had already partially provisioned for the expected losses on a sale. The “Carter” operation, unlike others over the last two years, does not include assets covered by the Resolution Fund guarantee.

In a note published on the Securities Market Commission (CMVM) website, Novo Banco reveals that it “signed a Sale and Purchase Agreement for the sale of a portfolio of non-performing loans and related assets (also known as Project Carter), with a gross book value of 79 million euro, to a company owned by affiliated companies and advised by AGG Capital Management Limited and Christofferson, Robb & Company, LLC.”

“The sale price totalled approximately 37 million euros, and the completion of the transaction, on the agreed terms, is expected to have a marginal positive impact on Novo Banco’s income statement and capital.”

The portfolio now sold includes 12,000 loans, not covered by the so-called Contingent Capital Agreement, which still has 900 million euros to be used by Novo Banco.