Austrian groups Erste and Volksbank sold the largest chunks of non-performing loans on the Romanian market last year, opening the market for more such deals in the future. Sales of bad loans in Romania could reach EUR 6.5 billion, according to analysts’ estimates.

“Sales of non-performing loans by the Romanian units of Erste Group Bank AG and Oesterreichische Volksbanken AG since July, spurred by the ECB’s asset quality review, are paving the way for more deals in the Black Sea country, where as much as half of the 13 billion euros of bad debt may be sold,” writes Bloomberg, quoting a PwC report.

In June last year, Volksbank sold EUR 495 million worth of non-performing loans to German group Deutsche Bank, and investment funds AnaCap Financial Partners, H.I.G. Capital International Advisors and APS Holding.

The second largest transaction was BCR’s sale of a EUR 433 million portfolio to Deutsche Bank and APS Holding in December 2014. The buyers paid some EUR 28 million for the assets, which was 6% of their face value, according to the financial blog CoStarFinance.com. Deutsche Bank had previously bought another EUR 227 million worth of NPLs from BCR in July 2014.

The largest portfolio on sale in Romania, last year, was that of Bank of Cyprus, which had a total value of EUR 545 million. However, the Cyprus-based group changed its mind and rejected all offers from investors as it was unhappy with the low valuations.

editor@romania-insider.com