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MADRID Dec 13 Spanish lender Popular has sold a 1.14 billion euro ($1.5 billion) portfolio of troubled consumer loans to a consortium of international investors, in a sign that sales of distressed assets are beginning to pick up.
A consortium led by Nordic distressed debt group Lindorff and funds advised by financial services-focused private equity firm Anacap bought the portfolio, Popular said in a statement on Thursday, confirming what sources told Reuters earlier..
Banco Popular did not disclose the price of deal, though a source familiar with the matter said on Thursday Popular could book a gain of over 30 million euros from the sale.
Popular, which unlike some other Spanish banks has not tapped European aid even though it failed a September stress test on its finances, shrank its capital gap with a 2.5 billion euro ($3.3 billion) rights issue of new stock completed in early
Such portfolio sales, including troubled assets or corporate loans, are starting to gather pace in Spain, as lenders scramble to shore up capital following a five-year-old property downturn.
The portfolio shed by Popular, of troubled consumer loans including to immigrant clients, was completely provisioned for, meaning the bank will not take an additional hit even if they are sold at a discount to their original face value.
All Spanish banks have made provisions for losses on toxic real estate loans or foreclosed properties, which should help them withstand sales of these types of assets at big discounts, which many had so far been resisting.
More deals in the property sector or on other portfolios such as consumer loans are likely to take place early next year, bankers in Madrid said earlier this week. (Reporting By Tracy Rucinski and Jesus Aguado; Editing by Sarah White and Elaine Hardcastle)