Dutch group to buy bankrupt DSB's German portfolio

Wed Jun 29, 2011 11:30pm EDT

Related Topics

* Dutch investor group to buy 115 euro mln loan portfolio

* DSB's Dutch and Belgian portfolio not for sale

* Novapars Capital seeking more acquisitions

By Aaron Gray-Block

AMSTERDAM, June 30 (Reuters) - Dutch investment group Novapars Capital said on Thursday it has agreed to buy the 115 million euro ($163 million) German loan portfolio of DSB Bank, the first sale of the bankrupt Dutch bank's operations.

DSB was declared bankrupt in October 2009 after it was hit by a liquidity crunch when clients withdrew about one-sixth of the group's deposits. The company was later seized by the Dutch central bank, DNB, and its assets are under administration.

Newly founded Novapars Capital said it will buy DSB's German portfolio of mortgages, loans to civil servants and car loans, plus a servicing organisation in Germany and its 14 employees. The group did not disclose the acquisition price.

"We're very happy to announce our first transaction," Novapars Capital co-founder and Managing Director Gerben Willems told Reuters. "We believe we have the required skills to acquire more portfolios and will do so in coming years."

"Banks are looking more and more to divest portfolios or part of portfolios because they want to clean up their balance sheet, amongst others, due to Basel III (capital requirements). That trend is causing a multibillion-euro market in Europe."

DSB was a small, but well-known lender in the Netherlands with about 8 billion euros of assets that became embroiled in controversy in 2009 when it was fined by the regulator for lending people more than they could afford to borrow.

The head of a foundation representing angry DSB customers later went on national TV and urged customers to pull out their money and a resulting bank run led to DSB's collapse.

DSB's Dutch and Belgian loan portfolios, valued at 5.7 billion euros and 300 million euros, respectively, are still part of the group's estate and are not yet being auctioned.

Trustees have sold the discount lender's headquarters but are still looking to sell its museum, the art collection of DSB founder Dirk Scheringa and other assets to pay creditors.

Novapars, which was set up a year ago and represents Dutch and German private investors, would be interested in buying the Dutch and Belgian portfolios of DSB, Willems said.

He said the German mortgages are relatively young, issued since 2006, and are of higher credit quality than the Dutch loans. Novapars does not intend to issue new mortgages and will instead service the existing ones.

Together with the civil servant and car loans, the maturities spread of the German portfolio is between five and 30 years.

Dutch bank NIBC provided debt financing to Novapars Capital. (Editing by Steve Orlofsky)

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