This summer the media reported that the European market for non-performing loans (NPLs) was becoming more active, with Italy and Spain accounting for most of the deals. According to the European Central Bank’s (ECB) semi-annual financial stability review, the total gross book value of NPL portfolios traded in the Eurozone reached €66 billion in Q4 2017, its highest since the data series began in 2015. The bulk of this figure came from Italy and Spain where several significant portfolios accounted for the majority of the total. The ECB has also noticed that transactions have begun to emerge in Greece, and Cyprus has seen its first NPL sales. However, the ECB has also seen a decline in activity in active markets such as Ireland as the number of NPLs decrease.
Our latest banking reform updater looks at the regulatory response to NPLs. Read the updater here.