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Market Watch – NPL Special: the Italian map of bad loans drawn up by Banca IFIS


Quarterly update through the ‘Market Watch NPL – Italian Scenario’- the map of non-performing loan transactions and market trends in Italy

Milan, 20 April 2017 – A complete map of transactions on the Italian bad loans market, trend analysis, and classification of Italian impaired assets by segment and geographical area. Banca IFIS has been collecting this information since April 2017 for its new ‘Market Watch NPL – Italian Scenario’ report and is able to analyze such data in a global manner thanks to the crossover of sources, its private database and its recognized leading position in the Italian NPL market.

This report, which will be available every quarter, shows general and detailed NPL trends, with particular focus on the typical completed deals and those in the pipeline that characterize the Italian scenario. The issue, written in English, is composed of four sections:

  • General overview (trends in the various categories of bad loans);
  • Distribution by industry and business segment (distribution of impaired loans by business segment as per the ATECO code);
  • Distribution by customer location (classification of NPLs by the geographical area of the debtors/clients involved);
  • Transactions on the Italian market (transactions as a whole and divided by macro asset categories), showing top buyers and originators.

The article is a snapshot of the Italian NPL market, easy to read and understand.

Here follow the highlights of the first issue of Market Watch NPL:

  • The amount of impaired loans has more than doubled in the last 7 years (from 145,7 billion Euro in 2010 to 324,3 billion at the end of 2016);
  • The majority of gross bad loans are concentrated within non-financial companies (71,3%). In particular, the Services and Construction Industries show the worst trend, with NPLs increasing respectively by +480% and +601% in the period running from the start of 2009 to the end of 2016;
  • Most NPLs originated in Northern Italy (51,9%, +370% since 2009), however Southern Italy and the Italian Islands are characterized by the worst bad loans to total loans ratio, with an increase in this index of about 8 p.p. for the Islands and of 7 p.p. for the South from 2011 until the end of 2016;
  • Transactions: in Q1 2017 deals totalled 2,8 billion Euro against 4,8 Billion in Q1 2016 (-41,6%) and 1 billion in Q1 2015 (+169,6%);
  • In 2016, both the retail debtor category and the corporate one increased with respect to 2015 but, at the start of 2017, the fastest growing category was the mixed one consisting of both retail and corporate debtors;
  • For all the deals concluded in Q1 2017, the price was below the threshold of 10% of face value;
  • 46,1 billion Euro worth of deals with status ongoing or announced are about to be released on the market.