After retreating from its international markets, SNS Property Finance (SNSPF) is now gearing up to terminate its Dutch activities. The news follows fresh losses during the third quarter at the Dutch property unit of SNS Reaal after higher loan impairments and operating costs.
After retreating from its international markets, SNS Property Finance (SNSPF) is now gearing up to terminate its Dutch activities. The news follows fresh losses during the third quarter at the Dutch property unit of SNS Reaal after higher loan impairments and operating costs.
In a trading update on Tuesday, parent company SNS Reaal announced it has decided not only to phase out the international property finance loans, but also part of the domestic portfolio. SNSPF will maintain its international portfolio and part of its Dutch loans, but will fully phase out the portfolio within the next two to four years, SNS Reaal said in a press statement.
The total run-off portfolio will now be managed in a new separate corporate unit. ‘Turning around the situation at SNS Property Finance and freeing up capital with a view to repaying the capital support from the state and the foundation remain, next to our customers, our key priorities,’ said Ronald Latenstein, CEO of SNS Reaal.
SNS Property Finance has reduced its international commitments by 32% after announcing plans to phase out part of its portfolio in mid-2009. Total commitments (gross loans including undrawn commitments) declined from EUR 13.8 bn at end-June to EUR 13.3 bn at end September. Total outstanding loans, net of provisions, fell from EUR 12.7 bn at end-June to €12.2 bn. The net international loans stood slightly below EUR 3 bn at the end of the third quarter.
Due to an increase of non-performing loans and a lower portfolio, total non-performing loans as a percentage of gross loans outstanding increased from 11.7% at end-June to 13.6% at end-September. Impairments on loans for Q3 rose to EUR 147 mln, compared to EUR 101 mln in Q1 and EUR 129 mln in Q2.
