Bank of Cyprus completes EUR1.34 billion loan sale as part of Helix

(Alliance News) - Bank of Cyprus Holdings PLC said Monday it has completed the sale of Project ...

Alliance News 28 June, 2021 | 12:01PM
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(Alliance News) - Bank of Cyprus Holdings PLC said Monday it has completed the sale of Project Helix 2, which refers to the sale of a EUR1.34 billion non-performing loan portfolio.

The lender sold the portfolio, secured over real estate collateral, to funds affiliated with Pacific Investment Management Co LLC.

Project Helix 2 is made up of Portfolio A and Portfolio B. Portfolio A - covering EUR916 million in non-performing loans - was sold in August last year to Pacific.

Portfolio B had a contractual balance of EUR783 million and comprises about 16,000 loans, mainly to retail and SME clients, secured over about 4,000 real estate collaterals.

Project Helix is Bank of Cyprus's effort to sell off its non-performing loans.

"The net consideration for the transaction amounts to about EUR560 million, of which about EUR165 million have been received in cash by completion," Bank of Cyprus explained.

It continued: "The remaining amount is payable in four instalments up to December 2025 without any conditions attached. The net consideration reflects adjustments resulting from, inter alia, loan repayments received on the portfolios since the reference date of September 30, 2019."

The bank noted the deal will up its CET1 ratio to 14.6% from 14.4% at March 31.

"Overall, including the release of risk weighted assets, the impact of the transaction on the group's CET1 ratio since the agreements were signed in August 2020 for Portfolio A and January 2021 for Portfolio B is about 50 basis points," Bank of Cyprus added.

The deal also reduces the lender's NPE ratio to 16% from 25% at March 31.

Overall, since the peak in 2014, Bank of Cyprus has lowered its NPE by EUR13.3 billion, or 89%, with its NPE ratio dropping from 63%.

Shares in Bank of Cyprus were 0.3% higher in London on Monday at 93.80 pence each.

By Paul McGowan; paulmcgowan@alliancenews.com

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Bank of Cyprus Holdings PLC 89.80 -

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