Corporate Recovery Management is the company to which Nextebank had transferred its non-performing loans during its portfolio cleanup process.
Market sources say the NPL portfolio APS got as a result of this deal has a par value of 492 million lei (EUR111 million) and includes corporate loans of 631 debtors.
APS Holding, a debt collection specialist based in Prague, was first noticed in Romania early this year, when it got EUR20 million funding from the International Finance Corporation (IFC), World Bank’s investment arm. IFC officials told ZF in May that the loan was granted precisely for the acquisition of three or four troubled loan portfolios from local banks.
APS name then showed up on the list of buyers of the EUR490 million NPL portfolio Volksbank sold in July in the largest deal in this country so far. The other buyers besides APS in the consortium led by Deutsche Bank were AnaCap Partners and HIG Capital.
Volksbank got about EUR100 million at the time, market sources say, and the loans sold were both secured retail loans and corporate loans. The bank lowered the NPL ratio to 8% from the previous 30%, following the deal.
Nextebank (the former MKB Romexterra) had reached an NPL ratio of 50% in 2012, triple the banking system average. The bank then started an extensive portfolio cleanup process to be able to find a buyer. It transferred the troubled loans to Corporate Recovery Management, a company directly held by the MKB Group.
Corporate Recovery Management posted about RON270 million losses in the last five years, according to Finance Ministry data, with a record high, more than RON130 million reached in 2011. The company was established in 2005.
The sour loan market has been very busy this year, once Romania’s central bank greenlighted removal of fully provisioned loans from banks’ balance sheets. Banks started selling secured loans and corporate loans to debt collectors, after having previously sold only unsecured consumer loans that had gone sour.
Several banks sold portfolios of tens of millions of euros in NPLs this year, and another major deal besides Volksbank’s was the EUR250 million loan sale by the largest lender on the market, BCR.
(English version by Loredana Fratila-Cristescu)