EXCLUSIVE-Intesa tests market with bad loan sales worth up to 5-6 bln euros-sources

MILAN, Feb 1 (Reuters) – Intesa Sanpaolo is advertising and marketing a nasty mortgage portfolio value as much as 5-6 billion euro ($6-$7 billion), two individuals aware of the matter mentioned, as Italy’s greatest financial institution steps up efforts to chop unhealthy money owed after shopping for smaller rival UBI.

Intesa Sanpaolo, which studies full-year outcomes on Friday, is predicted to replace traders on its clean-up plans, as Italian banks brace for a brand new wave of pandemic-driven drawback money owed as soon as government-support measures are lifted.

Intesa final 12 months shook up Italy’s banking panorama by launching an unsolicited takeover bid for UBI to cement its home management.

Italian banks’ discounted valuations enabled Intesa to make a paper revenue from the UBI deal of three.3 billion euros on the finish of September.

Intesa has mentioned it’ll use the funds to cowl integration prices and pace up disposals of non-performing loans (NPLs), according to tips from supervisors.

CEO Carlo Messina advised analysts when presenting nine-month outcomes the financial institution would “ship a formidable additional (NPL) de-leveraging within the coming quarters.”

The portfolio of loans being marketed contains loans originated by each Intesa and UBI, the 2 individuals mentioned. One among them mentioned the portfolio, which included additionally some leasing contracts, was divided into many sub-portfolios. A 3rd supply confirmed varied mortgage swimming pools had been being marketed.

Intesa in December accomplished a 4.3 billion euro unhealthy mortgage securitisation, decreasing its impaired debt burden to 24.6 billion euros gross of writedowns, or 5.9% of whole lending. That’s simply forward of a 6% aim the financial institution had set underneath for end-2021 underneath its present marketing strategy.

When factoring within the acquisition of UBI Banca, Intesa’s impaired loans stood at round 31 billion euros on the finish of final 12 months.

$1 = 0.8267 euros Reporting by Valentina Za. Modifying by Jane Merriman

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