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Alantra advises Piraeus Group on the signing of the second-largest NPE Securitization in Greece


ServiceCredit Transactions

Value €7.2 billion

Jun 2021
Securitization – Co-arranger and financial advisor
Value €7.2 billion

Athens Acting as co-arranger and financial advisor to the deal, Alantra, the global investment banking and asset management specialist, is pleased to announce that its client, Piraeus Financial Holdings S.A. (“Piraeus” or “the Bank”) has signed a definitive agreement with Intrum AB (publ) (“Intrum”) and Serengeti Asset Management LP (“Serengeti”) for the sale of 49% and 2% of the mezzanine and junior notes of the Sunrise I NPE securitization portfolio respectively.

Piraeus is proceeding with the implementation of Project Sunrise I (“Sunrise I”, “Transaction”) a securitization of a c. €7.2bn mixed portfolio of predominantly denounced non-performing loans, secured by real estate collateral. An application for the inclusion of the senior notes issued by the Sunrise special purpose vehicle, in the Hellenic Asset Protection Scheme (“Hercules”, “HAPS”), with a total nominal value of €2.45bn.

Conditional upon requisite supervisory and corporate approvals, Piraeus Financial Holdings is contemplating to distribute 44% of the mezzanine and junior notes of the Sunrise I securitization to its shareholders, while Piraeus Bank will retain 5% of the said instruments as per the respective securitization requirements. Piraeus Bank will retain also 100% of the senior notes. Subject to the required approvals, the loans within the Sunrise securitization perimeter are expected to be derecognized from Piraeus Financial Holdings consolidated statement of financial position within H2 2021.

The implied valuation of the Sunrise I portfolio based on the anticipated fair value of the senior notes and the sale price of the mezzanine and junior notes corresponds to c. 34.5% of the total gross book value of the Sunrise I portfolio.

This is the third and largest securitization agreement between Piraeus and Intrum:

  • In September 2020, Piraeus and Intrum signed Project Phoenix, a c. €1.9 NPE securitization of residential mortgages. The issued senior notes c. €1.0bn were included in HAPS. Piraeus has retained 100% of the senior and 5% of the mezzanine and junior notes, while 30% of the mezzanine notes were purchased by Intrum and 65% are to be distributed to Piraeus shareholders.
  • In March 2021, Piraeus and Intrum signed Project Vega, a non-performing loan securitization transaction, comprising predominantly denounced loans with a total gross book value of c.€4.9bn, secured by residential and commercial real estate. The Bank has applied for the provision of a Greek State guarantee under HAPS, on the senior notes issued by the three Vega special purpose vehicles (collectively amounting to c. €1.4bn). Upon closing of the transaction, Piraeus will retain 100% of the senior and 5% of the mezzanine and junior notes, while 30% of the mezzanine notes were purchased by Intrum and 65% are to be distributed to Piraeus shareholders upon closing.

Alantra has acted as financial advisor and co-arranger for Piraeus in both precedent transactions.

The Transaction is part of the wider Sunrise transformation program Piraeus announced on 16 March 2021 and underlines the rapid progress in Piraeus’ c.€19bn NPE clean-up plan, leading to a single-digit NPE ratio within less than 12 months. Following projects Vega and Phoenix which are about to be completed this quarter and Sunrise I, the NPE ratio of the Bank as of March 2021 will be reduced from c. 46% to c. 23%

The Transaction is subject to all customary approvals, including the consent of the Hellenic Financial Stability Fund.

Vasilis Kosmas, partner of Alantra, commented: “This transaction is important not only for our client, as the second-largest NPE securitization in Greece and the third securitization agreement between Piraeus and Intrum, but also for Alantra, since we have acted as advisors in this series of transactions. It demonstrates our enhanced credentials and capabilities as a trusted and independent advisor for complex performing credit transactions.”

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