Last year in Italy they were carried out 33 billion in non-performing loan transactions. Playing the lion's share was Banca Ifis which purchased 3,7 billion Npl, positioning itself in first place as "top buyer" and confirming its leadership in the Npl unsecured retail sector with a market share of 46% on just over of 7 billion euros of loans sold on the market in this asset class.
Also noteworthy is the record number of real estate transactions - about 700 thousand - carried out in 2021 and the positive effects produced by the launch of the telematic process and the 2015 reform which reduced the average auction closing time by about two years.
These are some of the numbers contained in the Market Watch Npl released today by the Venetian bank led by Frederik Geertman.
The NPL market in Italy
Based on the estimates contained in the document, in 2022 le new divestments of Npe (Non Performing Exposure) will reach 47 billion euros, of which 35 billion euros of NPLs and 12 billion euros of UTPs. Almost photocopied figures are also expected for 2023 (37 billion Npl and 10 billion Utp) for a total of 94 billion euros in sales over the two-year period.
In this context, the secondary market, which in 2021 recorded a 32% incidence on total transactions. In 2022, according to forecasts, it will rise by a further percentage point to 33%.
The report highlights how in the last four years, i.e. from 2017 to 2021, they have been almost 60 billion euros invested by servicers and investors to acquire €245 billion of NPL portfolios. “The market confirms the concentration of transactions both on the originator side, with 45% of the sales attributable to five large groups, and on the acquisition side: 31% of the volumes is managed by five buyers”, we read.
NPLs and banks
In terms of flows new non-performing loans on bank balance sheets, the Market Watch predicts the deterioration of approximately sixty billion euros of loans between 2022 and 2023. For 2024, however, a return to pre-Covid values is estimated, with a deterioration rate of around 1% which compares with the 2,4% estimated in 2022: a value far from the rate of 4,5% relating to the peak recorded in 2013. It is also improvingand the Italian Npe ratio estimated down to 4,7% at the end of 2021 below the ECB target of 5%.
Going forward with the data, lo total stock of Npe in 2021 it fell to 330 billion, but will grow to 402 billion in 2024. From the point of view of the composition, we note 88 billion euros of Npe held by the banks and 242 billion euros managed by servicers and specialized investors (about 73 %). In 2024 it is expected that as much as 78% of the NPE stock will be managed by the NPE industry and only 22% will be on the bank balance sheet.
An important novelty seen last year concerns the fact that the Utp entered in the balance sheets of banks they have exceeded the Npl stock: at the end of 2021, in fact, it is estimated 45 billion euros of Utp against 39 billion euros of non-performing loans. The overtaking is also confirmed for the next few years.
Credit risk and Gacs
The incidence of loans classified in stage 2 it went from 9% in 2019 to 15% at the end of 2021. The percentage will remain at around 14% in 2022 and then drop to 12% in 2024. At the end of 2021, Italy had around 44 billion in loans still in the moratorium, 82% are loans to businesses (36 billion euros). 16% of requests from 2020 are still active.
For the Gacs, from 2016 to today, the guarantees on the securitization of non-performing loans "have supported the Npl transaction market for 96 billion euros, equal to 36% of total Npl sales. In 2021, Gacs operations were 7 for 11 billion euros of GBV. Compared to previous years, in 2021 there will be a decreasing average price due to the lower incidence of secured credits”, the Report points out.
Justice and the real estate market
Last year, about 700 thousand real estate sales were carried out in our country, a record figure possible thanks to the great liquidity of households and businesses which is added to the tax incentives. It is estimated that growth will continue to be sustained in 2022 as well.
2021 also ended with 126.000 properties up for auction for a total value of 18,7 billion euros. “The number of postponed procedures for the blocking of executions in the first half of 2021 remains significant, equal to around 77 thousand auctions, with a failure to recover estimated at around 11 billion euros”, states the report.
The effects generated by the start of the telematic process and the 2015 reform were positive, with the reduction of about two years, between 2018 and 2020, of the average auction closing time who in 2021 are still serving 6,1 years of average life.
