BBVA puts PwC in charge of selling a third of its distressed loans worth 1 billion

BBVA does not want to waste a minute in the real estate clean-up. The entity led by Francisco Gonzalez put in the market, in the last few days, a portfolio worth 1 billion euros: ‘Project Sintra’, according to Financial Sources consulted by Vozpopuli. PwC advises in this transaction. Neither bank or advisor had a comment on the issue.
This portfolio is the one step before the last for BBVA to reduce its real estate exposition to zero, after the agreement with Cerberus for the transfer of 13 billion in awarded, as Vozpopuli anticipated. On sale, ‘Project Marina’ is still pending authorizations to be closed by the middle of the year.

The deinvestment balance in BBVA is the following: before Project Marina, it has a gross exposition (without counting provisions) of almost 16 billion, that will remain in around 3. Two thirds of them are defaulted loans linked to lands or completed developments, with a coverage rate of 54%.

With this new transaction, BBVA seeks to crown itself as the big entity that drops all its heritage from the crisis. Santander closed last year the sale of 30 billion from Popular to Blackstone, but still has 11.7 billion in portfolio.

Recurring stars

With ‘Project Sintra’, this is the third transaction BBVA awards to PwC. It did with ‘Project Jaipur’, worth 600 million, that Cerberus got awarded, and ‘Project Marina’ with the same advisor and buyer.

This last operation was received with unrest by some funds, that complained to the bank that there was no competitive process open, negotiating exclusively with Cerberus. From the transaction’s circles, they defend that a bilateral sale can optimize the price as much as an auction, due to the threat of opening the process to more rivals.

BBVA is thus one of the entities that have decided to step up on the portfolios sale in Q1, like Sareb, that is closing the sale of three or four portfolios: ‘Nora’, ‘Bidasoa’, ‘Dune’ and ‘Slap’, with a total volume of 3.2 billion.

One of the assets more in vogue, and that more and more entities are including in portfolios, is land. Thus, Sareb is considering a land-only operation, and Kutxabank is doing as much.

Source: Vozpopuli. Translation by Miguel Vinuesa Magnet.

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