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Relaunch of the non-performing loans market

After a slowdown in the NPL (Non-Performing Loans) sales market caused by the pandemic, there are promising signs of market recovery.

Seen as a way to reduce the stock of non-performing loans, increasingly more Portuguese banks are showing interest in selling portfolios of this type of credit, with several sales processes underway or already announced, including by banks such as Bankinter, Santander, EuroBic and Millennium BCP.

The launch of new sales processes is also expected in the coming months by Caixa Geral de Depósitos and Montepio Geral, as stated by Francisco Virgolino, Head Partner of NPL & REO Portugal at Prime Yeld in a study developed by the consulting company.

The dynamism of the Portuguese market has raised the interest of a growing number of investors in NPLs, which means that new market operators are expected to enter the market. Likewise, there are forecasts of a diversification of the supply of non-performing loan portfolios, which will promote the diversification of the profiles of active investors.

In addition, financial instability and the trend towards higher inflation could have an impact on the NPL ratio, which could rise over the next few years, thus generating new investment opportunities in the Portuguese market.

The content of this information does not constitute any specific legal advice; the latter can only be given when faced with a specific case. Please contact us for any further clarification or information deemed necessary in what concerns the application of the law.

Authors
Josefa Gabriel
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