Alpha Services and Holdings S.A. (together with its subsidiaries, “Alpha Bank Group” or “Group”) has reached an agreement with an affiliate of Cerberus Capital Management, L.P. (“Cerberus”) for the sale of a portfolio of non-government outstanding loans in Cyprus and real estate with a total gross carrying amount of c. €2.4 billion (“Portfolio”). The portfolio will be sold by a 100% (indirect) subsidiary of the Group, Alpha International Holdings S.M.S.A.
According to the statement, the Sky project is part of Alfa-Bank Group’s strategy to reduce non-performing loans and is the culmination of a series of similar successful transactions made by the Group in previous years. With this transaction, the Group further reduces risk on its balance sheet by lowering its NPE ratio by an additional five percentage points to approximately 13% (pro forma as at 30 September 2021).
Impact on the Group’s income statement is fully in line with the allocated loss budget at c. €0.2 billion with a commensurate impact on the Group’s overall capital adequacy ratio (CAD) of around 20 basis points (pro forma as at 30 September 2021).
The transaction is expected to close in the third quarter of 2022, subject to the usual regulatory approvals.
Alantra Corporate Portfolio Advisors International Limited (“Alantra”) acted as financial advisor, KPMG Limited (Cyprus) as local due diligence advisor, Allen & Overy LLP as international legal advisor and Chryssafinis and Polyviou LLC as local legal adviser.