Greece's fourth largest lender Alpha Bank has agreed to sell one billion euros of bad loans, most of which are backed by real estate, to a consortium of funds managed by Apollo Global Management and the International Finance Corp.
The bank said that it will earn 337.1 million euros from the sale of sour debt, that had been issued to small businesses.
The transaction is expected to have a positive impact for the bank in terms of capital and liquidity and is in line with plans to reduce non-performing exposures and restore its balance sheet, the lender said in a statement.
Greek banks are struggling to offload non performing loans accounting for with nearly one in two loans held on their books, raising concerns that they may need another round of capital injections. Alpha Bank said that its stock of NPLs in the third quarter of the year fell 4.4 billion euros from a year earlier to 22.5 billion euros.
The sale deal also includes an additional 56 million euros of real estate assets that have been repossessed by the Alpha Bank group.
The transitional servicing of the NPL portfolio has been undertaken by Cepal Hellas Financial Services. Citigroup Global Markets is advising Alpha Bank on the sale, while White & Case LLP and Koutalidis Law Firm are legal advisers.