The future of Non Performing Exposure (NPE) passes through new players, including investment funds, banks and other specialized operators; traditional business crisis management tools, although innovated by the legislative reforms of recent years, maintain inefficiency profiles especially for the management of unlikely to pay (UTP); the acquisition of the NPE of the banks by turnaround funds could represent an engine of the Italian industrial recovery and at the same time a support to the processes of reduction of the non-performing exposures of the banking system. This is what emerged at the conference "The Non Performing Exposure of banks: the role of mutual funds and other efficient management tools for NPLs and UTPs".
Organized in Milan by Fivelex Law firm, the event brought together experts and industry players to discuss opportunities and critical issues for the private sector equity and other specialized players in the management of bank exposure, also in the light of interventions by the ECB and the EBA-European Banking Authority. Francesco Canzonieri (Mediobanca), Enrico Fagioli (Spaxs Illimity), Federico Ghizzoni (Clessidra SGR), Vincenzo Manganelli (DeA Capital Alternative Funds), Salvatore Maccarone (President of the Interbank Deposit Protection Fund and of counsel of Fivelex), together with partners of Studio Alfredo Craca, Francesco Di Carlo and Claudio Tatozzi traced the scenario of the sector and hypothesized future developments.
The NPE of Italian banks, after their sharp increase in the years of the crisis, began to reduce steadily starting from 2016. To complete the process of reducing the NPE in Italy in the times that would be appropriate, the need emerges for broader initiatives and l intervention of financial operators, with strong skills in the processes of relaunching companies, who support banks and companies in the complex process of settling deteriorated situations.
The bottom can be one virtuous tool for the actors involved (creditor banks, debtor companies and others stakeholders) and can help relaunch businesses in a medium-long term perspective, thanks to a specialized investment approach, not only financial, but also industrial. A market with great potential, especially in the UTP segment, for investment funds special circumstances, which already saw in 2017 a growth of investments equal to +68% by amount (Source AIFI, 2018).
The analysis of the speakers who attended the event aimed more generally at a look at the varied range of NPE management tools available to banks, on the assumption that there is no a priori suitable solution and that the measure and technical form of intervention chosen from time to time according to various factors and varies according to the different ones asset class object of intervention (NPL or UTP). In some cases, the conversion of debt into equity may be the solution: the SMEs that make up the country's economic fabric are unable to meet their debt due to the crisis; at the same time, they are of great international appeal for history, quality and pricing. It is here that private equity operators will decide to invest more and more, changing the scenario of the prevalent recourse to bank financing which characterizes the Italian credit market.
