Hellenic Bank sells €145m in NPLs to Norway’s B2Holdings


By Stelios Orphanides

Hellenic Bank, Cyprus’ third largest lender, said that it agreed to sell Norway’s B2Holdings ASA €145m of loans as part of its strategy to reduce its delinquent loan portfolio.

The deal, subject to regulatory approval, affects 1,977 facilities extended to 1,158 borrowers and “is not expected to have a material impact on the income statement and capital position of the bank due to existing provisions taken against these assets,” the bank said in a statement on the website of the Cyprus Stock Exchange on Tuesday.

The completion of the agreement which is “at arm’s length” and affects “predominantly non-retail secured and unsecured exposures” will reduce by 6.2 per cent the bank’s non-performing loans seen at €2.3bn at the end of the third quarter of 2018, the bank said.

“The transaction is consistent with the bank’s strategy of ‘fixing’ the balance sheet and at the same time it is in line with the European Central Bank (ECB) and International Monetary Fund (IMF) guidelines on the management of non-performing loans,” Hellenic Bank said.

“In addition to organic reduction of the problematic portfolio, the bank remains focused on accelerating the de-risking of its non-performing exposures through portfolio disposals and other transactions”.

Hellenic Bank which posted an after-tax loss of €17.8m in the first nine months of 2017 and is struggling with a 55.7 per cent non-performing loans mountain, did not announce the price of the transaction. The coverage ratio of the bank’s non-performing loans with provisions was at the end of September 61.4 per cent.

A source at Hellenic said that part of the non-performing loans the bank agreed to sell to the Norwegian company’s subsidiary B2Kapital Cyprus Ltd were already terminated.

Hellenic’s agreement is the second transaction of this type and comes after the change in legislation as part of Cyprus’ adjustment programme terms. It also follows a May 2017 agreement between Bank of Cyprus and Cyprus Development Bank involving less than one seventh of the deal announced on Tuesday.

Hellenic’s agreement is the second transaction of this type and comes after the change in legislation as part of Cyprus’s adjustment programme terms. It also follows an May 2017 agreement between Bank of Cyprus and Cyprus Development Bank involving less than one seventh of the deal announced on Tuesday.



About Author

Stelios Orphanides is a journalist at CyprusBusinessMail.com. To contact Stelios Orphanides: [email protected]

  • Gui Jun An

    Perhaps the author will explain exactly what it means to sell npl’s to other banks; do homeowners lose their homes or is this just another exercise in restructuring?

  • dave

    Ha ha ha ha

    Presumably the mountain monkeys think Cyprus is in Europe and adheres. to the law, Scandinavian style

    • Vladimir

      Now it is time for Scandinavians to learn lesson – to stay away from Cypriots… 🙂

  • Bob Ellis

    I would imagine the 1,158 do not have relatives in Norway so they might have to honor their promises. Lets hope the law supports the Norwegians to a successful conclusion. Does CM know the extent of the discount given as I would imagine a high figure for anyone to touch bad debt in Cyprus ? Also, how many discounted bad loans can Helenic sell befoe they ycease to exist ?

  • Jeremy Rigg

    Now we will see some sparks flying……………cant wait.

  • alexander reutersward

    My guess is that the Norweigans looiked at it as a lottery ticket, waiting for laws to fall in place to be able to claim back property etc.

    I would be surprised if they had to pay over 20%!

  • Cydee

    Good thinking to deal via ‘arms-length’ companies. No vested interests so they can focus on reclaiming the debt and/or property.

  • Douglas

    This Act prohibits debt collectors and debt buyers from using certain “abusive and deceptive” actions while trying to collect debt from consumers.So a lot depends on Cyprus Laws to enable B2 Holdings to recover the debt they have probably purchase at 15% of the value,still a huge loss to the Bank.

  • costaskarseras

    This Nordic vulture-fund paid only a fraction even of today’s actual value of these properties. The price that was paid has not be disclosed because it would cause a public outcry. However, the EU forbits the haircut of debts to the borrowers, which is another indication of whose interest the EU serves.

    The Cypriots must not allow a single family to become homeless and as a first step should reject Anastasiades at the coming election. These unprincipled neoliberals don’t respect even the family home, they are copying the American example of foreclosure, where people are made homeless, living in their car and in temporary accommodation. In the meantime the neoliberal apologists of the EU bureaucrats with their fat salaries and generous allowances together with the Anastasiades government, are trying hard to convince the Cypriots that they have achieved an economic “miracle” just because Cyprus is able to borrow money in the markets. Their strategy to save the banks succeeded beyond expectations but the people will continue to suffer for the next decades until the banks’ debt is paid and we all know by whom and at what price.

    • mongasz

      as the stalinist imbecile that you are, you are excused for not understanding how a market economy works!
      1st lesson: when you borrow money you must repay!!!

      • costaskarseras

        “1st lesson: when you borrow money you must repay”. According to you and the neoliberals, this principle applies only to the working people and not to the the reckless and often criminal banks.