The multi-originator POP NPLs 2019 securitization has been completed: Prelios Credit Servicing will act as Master Servicer of the transaction, which will see Prelios Credit Solution and Fire as Special Servicer.

Dec 20 2019

Prelios Credit Servicing will act as Master Servicer in the multi-originator Pop NPLs 2019 transaction, announced on December 20 by 12 Italian commercial banks, including 8 Italian cooperative banks.

The portfolio of non-performing loans - transferred to a securitization vehicle, established pursuant to Italian law 130/99 and named POP NPLS 2019 Srl - has a gross collectible value of EUR 826.7 million, 58.6% of which consists of secured loans. The Italian State GACS guarantee on the senior tranche will be applied for shortly.

Luzzatti played the role of coordinator of the banks participating in the multi-originator transaction, while Jp Morgan acted as Arranger. The POP NPLS 2019 vehicle issued three ABS note tranches:

  • a senior tranche totaling EUR 173 million, corresponding to 21% of the gross collectible value, with BBB rating by DBRS and Scope Ratings agencies and eligible for GACS;
  • a mezzanine tranche totaling EUR 25 million, corresponding to 3% of the gross collectible value, with CCC rating by DBRS and Scope Ratings agencies;
  • a junior tranche, with no rating, corresponding to EUR 5 million.

The total value of the notes with rating corresponds to 24% of the gross collectible value.

As part of the transaction, Special Servicer, Fire and Prelios Credit Solution have been appointed. The latter will act as Special Servicer for a portion of the portfolio with collectable exposure totaling EUR 424.6 million.

"GACS continues to be the best and most transparent tool for reducing banks' exposure to NPLs: it maximizes the exit value of NPLs and minimizes the impact on capital" commented Marco Monselesan, PRECS portfolio management & NPL underwriting director. "Also following the entry into force of the new GACS regulation in the first quarter of 2019, Decree-Law no.22 of March 25, 2019, banking institutions will be able to continue to use a tool maximizing the NPL exit value, while minimizing impact on capital ". Monselesan added: “this instrument has significantly contributed to reducing the net NPL stock, approximately -63% over the last four years, freeing up capital to be allocated to the typical activity of banks, that is to financing businesses. Prelios confirms its place as the best vantage point for observing the positive effects of this tool, given that, to date, it manages 13 of the securitization transactions using the State guarantee scheme launched over the last four years".

The multi-originator Pop NPLs 2019 transaction was announced by Banca Agricola Popolare di Ragusa, Banca Popolare del Lazio, Banca di Piacenza, Banca Popolare Pugliese, Banca Popolare di Fondi, Banca Popolare del Frusinate, Banca Popolare di Puglia e Basilicata, Banca del Sud, Banca di Cividale, Cassa di Risparmio di Asti, Biver Banca - Cassa di Risparmio di Biella e Vercelli and Banca di Credito Popolare.

The advisor KPMG Advisory, the Law Firm RCCD, the Law Firm Orrick, BNP Paribas Securities Services, Securitisation Services (Finint Group) and Zenith Service.