Banca Ifis Considering Buying $2.2 Billion Bad Loans by Year-End

  • Ifis has made binding offers for secured and unsecured NPLs
  • Company also considering sale of EU1 billion of bad loans

Banca Ifis SpA is in the process of purchasing several portfolios of non-performing loans for a face value of more than 2 billion euros ($2.2 billion) by the end of the year, as the Italian financial-services company expands its business in distressed assets.

“Ifis made binding offers to buy 550 million euros of secured and unsecured NPLs from 4 banks in an auction that should be finalized this month,” Chief Executive Officer Giovanni Bossi said in an interview at the Ambrosetti Forum in Cernobbio, Italy. Ifis also made binding offers for 400 million euros of bad loans in a deal that may be finalized in October, while more than a billion euros of loans are in the pipeline to be purchased by the end of the year, he said.

At the same time, the company is considering a possible sale of 1 billion euros of bad loans this year, the CEO said.

Banca Ifis is focusing on boosting margins from the recovery of distressed loans and is expanding business through acquisitions. In July the Venice-based firm reached an accord to buy General Electric Co.’s GE Capital Interbanca unit as an entry into the medium-term lending business and strengthened its factoring and leasing activities.

“Ifis is planning to expand in corporate deteriorated assets, developing a platform to manage loan recovery from Italian banks,” Bossi said. “The platform will leverage on Interbanca’s skills and expertise,” he said.

Bossi expects to complete the purchase of Interbanca in November and plans to merge the unit and its factoring business into Ifis next year.