On August 1, 2018 as part of its NPL reduction plan to bring the ratio of gross non-performing loans below the 10% level by end 2019/beginning 2020, UBI Banca announced the transfer to the independent securitization vehicle Maior SPV S.r.l. of a portfolio of bad loans for which the gross nominal value (gross book value) on the reference date (12.31.2017) amounted to 2,748.8 million euro.
The transfer price is substantially in line with the current net carrying amounts of the transferred loans and such as to comply with the requirement set out in the regulations for the release of the guarantee on the securitization of bad loans (“GACS”) pursuant to Law Decree 18/016.
UBI Banca said that consistently with the Group's management strategy, focused primarily on direct credit recovery, the portfolio is composed mainly of unsecured loans (53.4%), while secured loans account for 46.6% of the portfolio. The securitization vehicle Maior SPV S.r.l. has issued senior, mezzanine and junior notes which have been subscribed by UBI Banca S.p.A., as follows:
- senior investment grade notes amounting to 628.5 million Euro, accounting for 22.86% of the gross nominal value and for 38.9% of the gross balance sheet exposure. These percentages are high, notwithstanding the large presence of unsecured loans, which confirms the overall credit quality.
The ratings assigned by the specialist ratings agencies Scope Ratings GmbH and DBRS are BBBsf and BBB (low)(sf) respectively;
- mezzanine notes amounting to 60 million Euro (no rating assigned);
- junior notes amounting to 26.9 million Euro (no rating assigned).
The securitization vehicle Maior SPV S.r.l. appointed Prelios Credit Servicing S.p.A. as Servicer and Special Servicer for the securitized portfolio, with responsibility for management, administration, recovery and enforcement of recovery of the loans in the name and on behalf of Maior SPV S.r.l.
On completion, the operation announced by UBI Banca will be the ninth GACS guarantee in Italy effected through Prelios Credit Servicing.