A record €104.4bn (£91bn) of non-performing loan deals were closed in 2017, bolstered by two of the three biggest ever deals in the market, according to Evercore’s European Distressed Real Estate Market report.
Santander’s €30bn (£26.4bn) Project Quasar deal in Spain, in which it sold a 51% stake of its Banco Popular portfolio to Blackstone, was the biggest NPL deal last year, single-handedly making Santander the third most active European vendor since 2014 – behind UK Asset Resolution and Ireland’s National Asset Management Agency.
Spain accounted for 49% of activity last year as the UK and Ireland continued to wind down their activity.
Although the UK’s €18.3bn total was the third highest in Europe in 2017, it was down to UKAR’s €15bn Project Ripon sale. Excluding this, Evercore said, the remaining UK deals made up just 5.7% of total volume.
The year was characterised by considerably larger deals, with an average transaction size of €1.3bn – up from an average of €571m between 2014 and 2016.
Nearly three-quarters of the activity took place in the second half of 2017, led by a whirlwind Q3 when €53.3bn of deals closed. This was more than the total for all of 2016.
Evercore is now tracking €18.9bn of live deals in the European NPL market, the biggest of which is UKAR’s €6.6bn sale of buy to let mortgages originating from Bradford & Bingley.
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