A special operative Decree by the Treasury Ministry in Italy is expected by the end of November in order to transfer to non performing loans management veichle Società Gestione Attività (Sga) a total of 17.7 billion euros of non performing exposures which were on the books of Banca Popolare di Vicenza and Veneto Banca at the moment they almost defaulted last June. Back then, two bad banks were created while Intesa Sanpaolo announced it would have bought the two banks’ in bonis assets (see a previous post by BeBeez).
However 9 billions out of those 17.7 billion euros are unlikely-to-pay loans which can hardly be dealt by Sga, which is neither a bank nor an investment fund which are instead allowed to inject new finance in a distressed company in order to relaunch the business and pay back its debts. This is why Sga’s ceo Marina Natale and chairman Alessandro Rivera are said to be in talks with a couple of Italian banks who may act as for Sga itself, MF Milano Finanza writes today.
However the market knows that unlikley-to-pay situations need to be dealt by turnaround specialists when corporates are involved which is the case of a major part of Italy’s unlikely-to-pay loans. And this is why italian and international turnaround private equity and private debt funds are ready to act.