Earlier today, Alpha Bank said that it has reached an agreement to sell a portfolio of Cypriot non-performing loans (NPLs) and real estate properties, with a total gross book value of €2.4 billion, to an affiliate of Cerberus Capital Management, L.P. (“Cerberus”).
According to a statement issued by the Bank, “Project Sky forms part of Alpha Bank Group’s strategy to reduction its stock of non-performing loans and is the culmination of a series of similar successful transactions completed by the Group over previous years.
“With this transaction, the Group further de-risks its balance sheet by reducing the NPL ratio by an additional approximately five percentage points to 3% (as of September 30, 2021 pro forma).”
This transaction will further de-risk the Group’s balance sheet by reducing its non-performing exposure (NPE) ratio by an additional five percentage points to 13%.
The impact of the sale on Alpha Bank’s income statement is fully in line with a budgeted loss of €200 million, while the impact on its total capital adequacy ratio will be around 20 basis points.
Completion of the sale is expected in the third quarter of this year, subject to the usual regulatory approvals.