ECONOMY

Alpha Bank receives two bids for bad debt portfolio

Alpha Bank receives two bids for bad debt portfolio

Alpha Bank, Greece’s fourth largest lender, said on Monday it had received two binding bids for the sale of a bad loan portfolio worth about 10.6 billion euros ($12.35 billion).

The transaction will involve a securitiζation and also the sale of the bank’s loan servicing platform Cepal.

The portfolio, known as Galaxy, consists of retail loans worth 7.6 billion euros plus loans to medium-sized and large corporate clients worth 3 billion euros.

The bank did not disclose further details.

Greek banks have been struggling to reduce a pile of bad loans worth about 60 billion euros, the legacy of a decade-long financial crisis that shrank the country’s economy by a quarter.

Alpha Bank, which is 11% owned by Greece’s bank rescue fund HFSF, wants to reduce its bad loan ratio to 13% of its total loan book.

It reported profit of 97.5 million euros in the second quarter of the year while its non-performing loans stood at 30.2%.

[Reuters]