Eurohypo has disposed of a EUR 200 mln portfolio of Finnish real estate loans, the German lender announced on the first day of EXPO REAL The portfolio was acquired by Nordic bank Nordea in Helsinki.
Eurohypo has disposed of a EUR 200 mln portfolio of Finnish real estate loans, the German lender announced on the first day of EXPO REAL The portfolio was acquired by Nordic bank Nordea in Helsinki.
Speaking to PropertyEU, Eurohypo CEO Frank Porschke said the deal was an important step in the bank's strategy to exit non-core markets. ‘We want to exit the Finish market but not at any price. The buyer has accepted that the Finnish portfolio is of good quality.’ He declined to provide further financial details.
Hendrik Gienow, head of global restructuring at Eurohypo added that the systematic downsizing of the (overall) portfolio was progressing ‘according to plan’. The bank intends to dispose of between EUR 8 bn and EUR 9 bn of loans spread across several countries in the restructuring process.
Porschke said he was not in a rush to downsize the portfolio. 'It will take several years - between five and six - to complete this process.' Europhypo recently obtained control of an office development in London from Spanish developer Monteverde and is now in talks to build on the site. By creating a joint venture with a new partner, Eurohypo hopes to profit from the upside of the development, Porschke explained. Such constructions are an option for other problematic loans involving developments, he said, but added that Eurohypo did not have all that many on its books. 'We’re not talking about dozens of developments, probably only a handful. When there's a problem with a loan, we first try to work with the existing client to find a solution which generally involves the client providing more equity. In most cases, this works as our borrowers belong to the top tier investors.'
Commenting on the outlook for new lending business this year, Porschke reiterated his statement that full-year volume would exceed the EUR 10 bn recorded last year. In the first half of 2010, the German lender chalked up EUR 7.5 bn in new business. ´I expect we will match that figure in the second half,´ Porschke said.
